April 24, 2024

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[THE INVESTOR] Hyundai Wia is inching out of its worst phase as its Chinese operation’s operation ratio regains and competition in domestic market eases, said Meritz Securities on June 21, upgrading its recommendation to a “buy” from a “hold” and raising the target price to 91,000 won (US$79.58) from 60,000 won.

Its second-quarter earnings will miss market expectations, hurt by Hyundai Motor and Kia Motors’ sales decline in China and the continued loss from its machinery business, said analyst Kim Jun-seong.


The prospects for its growth from next year, however, are bright and earnings per share will hike 58 percent on-year, said the analyst. The operation ratio of its Chinese branch was restored to about 50 percent in June, from 30 percent in April-May, and fierce competition with Doosan Machine Tools is alleviating, said Kim.

The production of new K3 and Accent models will begin and push its Mexico factory back to normal while the planned upgrade of power trains will start in the second half, added the analyst. 

By Hwang You-mee (glamazon@heraldcorp.com)