Hana Securities noted on the 10th that a supplier-dominant market for Hyosung Heavy Industries is expected to continue, leading to anticipated performance growth. They maintained a 'buy' investment recommendation and revised the target price from the previous 600,000 won to 1,200,000 won, a 100% increase. The closing price for Hyosung Heavy Industries on the previous trading day was 943,000 won.

Hyosung Heavy Industries CI.

Yu Jae-sun, a Hana Securities researcher, said, “The expansion of the headquarters in Changwon has been completed, and expansions will also be carried out sequentially in Memphis, USA next year, with additional expansions in the North American market under review.” He added, “Demand for products is robust, but the expansion of production facilities is slow, so the supplier-dominant market is likely to continue.”

The profit growth in the institutional sector of heavy industry is also positive. Researcher Yu noted, “The profit margins of overseas production subsidiaries in the U.S., India, and China exceed the average margin of the heavy industry sector,” and stated, “The proportion of relatively low-margin domestic sales and orders at the headquarters has been gradually decreasing, while overseas sales are increasing on a cumulative basis.”

Hana Securities estimated that Hyosung Heavy Industries will record sales of 1.36 trillion won and an operating profit of 136.5 billion won in the second quarter (April to June) of this year. These figures represent increases of 14% and 117%, respectively, compared to the same period last year.

Researcher Yu explained, “Some European sales carried over from the previous quarter will be reflected in the results, and high-margin orders will be recognized, leading to a continued growth trend in the institutional sector of heavy industry.”

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