May 08, 2024

• 

[THE INVESTOR] Hankook Tire will enter a virtuous cycle in the third quarter as its business in the US recovers, said Samsung Securities on Sept. 7, maintaining a “buy” recommendation and 56,000 won (US$49.84) target price. 

It has almost completed streamlining its domestic distribution network while its US operations are expected to reach break-even point in the third quarter. As the operation ratio of its US factory rises, it will be able to turn around. Losses from its factory this year will be slashed to 30 billion won from last year’s 80 billion won, producing 4 million units and reaping 300 billion won revenue. In 2019, it will generate 400 million won revenue and 40 billion won operating profit, said analyst Im Eun-yeong.

It is likely to secure a new client for original equipment tires in North American market, where its share has climbed to 6 percent last year from 4.9 percent in 2013. Meanwhile, as it completes expansion of facilities, odds are more likely that it will increase dividends, she added. 

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