[Click eStock] "Hyundai Glovis Signs 6.7 Trillion KRW Contract with Hyundai and Kia Motors... Profit Increase Expected"

5-Year Contract from 2025 to 2029
Large-Scale Agreement Reflecting Freight Rate Increase
Strengthened Long-Term Shareholder Return Policy... Attractive Stock Price

NH Investment & Securities analyzed on the 2nd that Hyundai Glovis is expected to see profit growth due to a year-end contract worth 6.7 trillion KRW.

According to NH Investment & Securities, Hyundai Glovis signed finished car maritime transport contracts worth 3.37 trillion KRW and 3.33 trillion KRW with Hyundai Motor Company and Kia Motors respectively on December 31. The contract period spans five years, from 2025 to 2029. This contract covers the export of vehicles produced domestically by Hyundai Motor Company and Kia Motors, with Hyundai Glovis handling 50% of the domestic production volume, and the remaining 50% being transported by Eukor Car Carrier. Eukor Car Carrier is a joint venture between Hyundai Motor Company and Wallenius Wilhelmsen.

At the end of 2021, Hyundai Glovis had signed a three-year transport contract with Hyundai Motor Company and Kia Motors covering 2022 to 2024. That contract was worth a total of 1.96 trillion KRW and covered 60% of the domestic production volume of Hyundai Motor Company and Kia Motors. Although the current contract is a five-year transport agreement with a reduced volume share of 50%, the contract size reaches 6.7 trillion KRW, reflecting an increase in freight rates. The applied exchange rate was also adjusted upward to 1,470 KRW, and factors such as increased vehicle weight being shipped and changes in transport routes are analyzed to have contributed to the freight rate increase.

Jeong Yeonseung, a researcher at NH Investment & Securities, stated, "This contract aligns with Hyundai Glovis’s announced goal of maximizing profitability, and profit growth is expected through freight rate increases with affiliates," adding, "Considering Hyundai Glovis’s mid- to long-term shareholder return policy, the current stock price level is analyzed to have sufficient valuation merit." Hyundai Glovis is evaluated to have ample potential for stock price appreciation through profitability improvement and a long-term shareholder return policy, with a price-to-earnings ratio (PER) of 6.0 times as of 2025.