[Click eStock] "Myeongshin Industry, Positive Performance Expected in Second Half"

Daishin Securities analyzed on the 14th that Myeongshin Industry is expected to have favorable performance in the second half of the year. The investment opinion 'Buy' and the target stock price of 20,000 KRW were maintained.

Myeongshin Industry recorded sales of 397.6 billion KRW and operating profit of 42.3 billion KRW in the second quarter. These figures represent decreases of 15% and 45%, respectively, compared to the same period last year. Kim Gwi-yeon, a researcher at Daishin Securities, stated, "The performance fell short of estimates due to larger-than-expected production sluggishness at client companies and stabilization of raw material prices linked to unit prices," but also evaluated, "Despite the slowdown in scale, the operating profit margin of 10.6% indicates that double-digit profitability has been sustained, which is positive."

In particular, a stable performance trend is expected to continue in the second half of the year. Daishin Securities forecasted that Myeongshin Industry's sales and operating profit in the third quarter will reach 417.7 billion KRW and 45.1 billion KRW, respectively. He explained, "Due to improvements in client company volumes, operating rate of the second North American plant, and increased localization rate, double-digit solid profitability is expected to continue," adding, "Improvements in client company volumes and the full-scale introduction of the truck lineup will begin."

At the same time, Myeongshin Industry's current stock price was evaluated as undervalued. He emphasized, "Since August, the stock price has been downgraded again due to concerns over electric vehicle fire issues and demand slowdown from North American clients," and added, "Considering the expected favorable performance from improvements in the operating rate of the second North American plant and client company volumes in North America, the stock price level is judged to have sufficient potential for short-term rise depending on changes in investment sentiment toward battery electric vehicles (BEV)."