[Click eStock] "Hyundai Motor Entering Premium AI Company Ranks... Target Price Raised"

Target Price Raised from 3.8 Million Won to 4.1 Million Won

On January 9, Shinhan Investment Corp. reported that Hyundai Motor Company is entering the ranks of premium artificial intelligence (AI) companies, raising its target price from 3.8 million won to 4.1 million won. The investment opinion was maintained as 'Buy'.

Park Kwangrae, a researcher at Shinhan Investment Corp., stated, "Hyundai Motor is expected to see a stepwise increase in its stock price and valuation in line with future timelines for autonomous driving and physical AI," adding, "The share buyback, which had been delayed due to tariff uncertainties, will also serve as an additional positive factor for the stock price."

Hyundai Motor's fourth quarter results for last year are expected to meet market expectations. Park predicted that Hyundai's fourth quarter operating profit would be 2.75 trillion won, a 2.7% decrease compared to the same period last year, but in line with the market consensus of 2.83 trillion won. He explained, "Operating profit is likely to be pressured by around the mid-1 trillion won range in tariff costs, keeping the operating margin at 5.7%. However, the lower share of less profitable electric vehicles has been offset by a high-profit mix of SUVs, Genesis, and hybrids. The positive impact of a stronger won-dollar exchange rate and reduced provisions for sales warranties will help avoid a sharp decline in profits."

Shinhan Investment Corp. forecasts that Hyundai Motor's performance this year will show a 5.2% increase in sales to 197.6 trillion won and a 10.5% increase in operating profit to 13.8 trillion won compared to the previous year. Park commented, "From the first quarter, the full-year effect of a 15% tariff rate reduction will lead to cost savings of 700 billion to 800 billion won per quarter, driving profit improvement. The operation of the Pune plant in India will provide a new growth engine, and the flexible scheduling of hybrid production at the Georgia plant in the United States will enable Hyundai to respond swiftly to changes in market demand, which is also a positive factor."