[EQUITIES] ‘Hyundai Electric to dip temporarily’
[THE INVESTOR] Hyundai Electric will be burdened by rising costs for the time being, said NH Investment and Securities on Feb. 14, lowering the target price to 130,000 won (US$119.99) from 155,000 won.
While demand is recovering slow, unfavorable exchange rate and increase of raw material costs dragged down its earnings in the fourth quarter last year to a disappointing low, and although its product competitiveness has improved it will underperform, said analyst Yoo Jae-hoon.
This year, though, demand for power apparatus will pick up as emerging markets recover, leading to a rise in orders in the latter half, forecast the analyst.
Its earnings will improve in earnest from next year and investors should also consider the company’s capacity to generate stable profits in domestic electronics device sector and the likely revitalization of the industry, added Yoo maintaining a “buy” recommendation.
By Hwang You-mee (email@example.com)