[Alpha Biz= Kim Sangjin] SK Securities has maintained its "Buy" recommendation and a target price of 500,000 KRW for Hyosung Heavy Industries, citing optimistic prospects for this year's performance.
The brokerage firm highlighted key drivers, such as factory expansion and improved sales mix, as factors contributing to the company's outlook. "The expansion of the Changwon factory is expected to be completed in the first half of this year, with capacity (CAPA) growth effects anticipated in the second half," SK Securities stated.
Additionally, the prolonged demand cycle for power equipment that began in the U.S. is now expanding into Europe. The firm noted, "Orders from Europe have been increasing since last year, and starting this year, these orders are expected to meaningfully contribute to profitability, driving improvements in earnings."
For the fourth quarter of 2024, SK Securities forecasted Hyosung Heavy Industries' revenue at 1.442 trillion KRW and operating profit at 123 billion KRW, reflecting year-over-year growth of 11.6% and 94.4%, respectively.
For 2025, the company is projected to achieve revenue of 5.237 trillion KRW and operating profit of 474 billion KRW, marking annual increases of 9.9% and 33.9%. An analyst at SK Securities commented, "Based on the 2025 earnings outlook, the company is trading at a price-to-earnings ratio (PER) of 13.9x and a price-to-book ratio (PBR) of 2.6x."
Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)
