[Click eStock] "Kia, Maintaining Smooth Earnings Momentum"

Shinhan Investment Corp. maintained its investment opinion of 'Buy' and target price of 110,000 KRW for Kia on the 7th.

Kia's global wholesale sales for April-May reached 528,000 units, an 11% increase compared to the same period last year. Domestic sales recorded 99,000 units, while overseas sales of 428,000 units drove the growth. In the domestic market, monthly sales of around 50,000 units have been steadily maintained, provided there are no variables such as a decrease in business days or large-scale strikes. Although there was some impact from the Metal Workers' Union strike at the end of May, the production disruption was minimal, around 2,000 units. The shutdown of the Gwangmyeong 2 plant for the transition to electric vehicles is scheduled to continue for six months until the end of the year, but it is expected to have little impact on overall sales, focusing mainly on non-core models.

The key to this year's performance is overseas markets. The leading region driving strong sales in April-May was the United States, with 141,000 units sold. High-priced models such as Sorento and Telluride performed well, significantly contributing to profitability. The second strongest sales region was Europe, with 101,000 units sold. The local plant in Slovakia converted about 10,000 units out of a monthly production of around 30,000 units to hybrid (HEV) and plug-in hybrid (PHEV) vehicles, and the volume of electric vehicles exported from Korea is estimated to have exceeded 6,000 units per month. Although concerns about the European economic slowdown remain, Kia maintains a favorable portfolio centered on electrified vehicles.

Jung Yong-jin, a researcher at Shinhan Investment Corp., stated, "It is difficult for the stock price to decline further while the earnings momentum is maintained," and added, "We maintain the target price of 110,000 KRW and the investment opinion of Buy."