This article was published on Feb. 6, 2025, at 4:26 p.m. on the ChosunBiz MoneyMove site.
HD Hyundai Group's robotics subsidiary, HD Hyundai Robotics, is in contact with financial investors (FI) to attract pre-initial public offering (IPO) investment. It is reported that the company expects a pre-investment corporate value in the range of 7 trillion to 8 trillion won.
According to investment banking (IB) industry sources on the 6th, HD Hyundai Robotics is seeking to finalize its investment attraction strategy and has been assessing the interest of potential buyers since the end of last year. Receiving investments in the form of equity is considered likely, although the scale of investment has not yet been determined.
HD Hyundai Robotics is continuing the legacy of the robotics business that began at Hyundai Heavy Industries in 1984. It produced its first industrial robot in 1987 and has since supplied them to automotive manufacturing plants both domestically and internationally. In 2021, it exceeded a cumulative production of 60,000 industrial robots and currently ranks first in sales in the domestic robotics market.
The major shareholder of HD Hyundai Robotics is HD Hyundai, which holds a 90% equity stake. KT, which invested 50 billion won in 2021, holds the remaining 10% equity. At the time of KT's investment, the corporate value was 500 billion won.
It is reported that HD Hyundai Robotics expects a corporate value of at least 7 trillion won in this pre-IPO investment. Although the annual revenue for 2023 was 172.7 billion won, which is a decrease from 189.2 billion won in 2021, the company's valuation has increased more than 14 times.
The basis for HD Hyundai Robotics expecting a high corporate value is a comparison with Doosan Robotics. With an annual revenue of only 53 billion won, Doosan Robotics had a market capitalization of up to 8 trillion won (based on December 2023 stock prices). Therefore, even conservatively, HD Hyundai Robotics, with revenue exceeding three times that of Doosan Robotics, should be valued at 7 trillion to 8 trillion won. Currently, despite Doosan Robotics' stock price having nearly halved from its peak, its market capitalization still reaches 4.5 trillion won.
Industry insiders explain that compared to Rainbow Robotics, now a subsidiary of Samsung Electronics, the expected valuation for HD Hyundai Robotics is by no means excessive. For 2023, Rainbow Robotics' annual revenue was just 15.25 billion won, less than one-tenth of HD Hyundai Robotics. Its current market capitalization is around 7.2 trillion won.
Reactions in the market regarding HD Hyundai Robotics' investment attraction have been mixed. One IB industry source noted, "Investment sentiment in the robotics industry is very positive, so domestic asset managers as well as foreign hedge funds that frequently engage in pre-IPO investments are likely to show interest."
Conversely, another source stated, "The market situation is very different now compared to when Doosan Robotics went public and saw its stock price rise," adding, "It is questionable how many investors will recognize and invest in the corporate value of 7 trillion to 8 trillion won."
Since HD Hyundai Robotics is attracting pre-IPO investment, the market expects the company to go public within the next two years at the latest.