Meritz Securities has maintained its target price of 340,000 won and a "buy" rating for Hyundai Glovis, citing expected benefits from the increase in Chinese car exports and a shortage of car carriers. The potential for a special dividend due to the rising value of its stake in Boston Dynamics was also highlighted as an investment point.
Analyst Kim Jun-sung at Meritz Securities forecasts that Chinese car exports will exceed 10 million units this year. Despite the surge in exports, the global supply of car carriers is expected to stagnate until 2030, which could lead to sustained strong freight rates.
However, for the second quarter, operating profit is anticipated to fall short of market expectations, projected at 488.4 billion won, impacted by the blockade of the Strait of Hormuz and soaring fuel costs.
Looking ahead to the second half of the year, Kim predicts that the effects of freight rate increases linked to oil prices and the deployment of large car carriers at lower charter rates will lead to improved performance. The number of car carriers operated by Hyundai Glovis is expected to grow from 96 last year to 102 this year, and further to 118 by 2028.
Additionally, the development of Hyundai Motor Group's robotics business and the potential for an IPO of Boston Dynamics are noteworthy. Hyundai Glovis holds an 11% stake in Boston Dynamics, and there is a possibility of increased shareholder returns through special dividends from future share sales. Kim described Hyundai Glovis as a company capable of achieving performance growth and differentiated shareholder returns.
* This article has been translated by AI.
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