April 27, 2024

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[THE INVESTOR] Doosan Bobcat, a construction equipment unit of Doosan Group, is expected to earn solid earnings this year following the incoming US government‘s massive infrastructure spending, analysts said on Jan. 9.

The incoming US administration plans to spend US$1 trillion on infrastructure -- tunnels, roads and ports.

“Doosan Bobcat generates some 70 percent of its revenues from the North American market and has maintained its top slot in the region’s compact construction equipment market over the past 50 years,” said Kim Hong-kyun, an analyst at Dongbu Securities.

The analyst said Doonsan Bobcat is forecast to earn US$1.78 billion in revenue from the planned infrastructure spending.

Kim set a 12-month price target for Doosan Bobcat at 45,000 won (US$37.40) citing upbeat earnings and its brand power.

Samsung Securities analyst Han Young-soo said Doosan Bobcat’s earnings will also improve through reduced financing costs and its stock price will get a boost from more shareholder friendly policies in store.

Aided by such optimism, foreign investors had continued to snatch up Doosan Bobcat since its market debut on Nov. 21.

(theinvestor@heraldcorp.com)