April 25, 2024

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[THE INVESTOR] Hyundai Mobis is drawing expectations with its steady parts business and launching into a new business, said Mirae Asset Daewoo on Jan. 5, maintaining a “buy” recommendation and target price of 310,000 won (US$292).

Its operating profit in the fourth quarter last year fell 11 percent on-year to 602 billion won, as shipment of Hyundai Motor and Kia Motors slid 15 percent, said analyst Park In-woo.

This year, however, the figures will rise 10 percent from 2017 to 2.53 trillion won, on the back of strong parts and module businesses, forecast the analyst. 

The parts sector maintains high profitability and stable cash flow and has not been particularly vulnerable to changes in the won-dollar exchange rate, according to Park. 

Stable growth of the sector and power trains for eco-friendly cars and advanced driver-assistance systems will bolster the company, as its low valuation and the possibility of a governance restructuring of Hyundai Motor Group make it attractive, he added.

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