DAISHIN SECURITIES emphasized on the 28th that HD Hyundai Heavy Industries has the potential for growth both quantitatively and qualitatively by merging with HD Hyundai Mipo. As a result, it maintained a 'buy' rating, but raised the target price to 660,000 won, a 20% increase from the previous estimate. On the last trading day, HD Hyundai Heavy Industries closed at 521,000 won.
According to DAISHIN SECURITIES, HD Hyundai Heavy Industries has set a sales target of 37 trillion won by 2030 after restructuring its business. This merger is a strategic business restructuring aimed at responding to the rapidly changing shipbuilding industry and to meet the demand for new military vessels domestically and internationally as well as for overseas maintenance, repair, and operations.
Researcher Lee Jin-yi from DAISHIN SECURITIES noted, 'The restructuring is expected to result in improved net profit through cost reductions in research and development (R&D), synergies, lower financial expenses, and enhancements in the production supply chain.' He said, 'The merger is expected to expand business synergies and increase market share through economies of scale.'
The researcher continued, 'In the blueprint for sales of 32 trillion won by 2030, the defense sector is projected at 7 trillion won, and even if the defense industry drops, sales in the shipbuilding sector are expected to hold steady.' He explained this is because they are considering additional construction of special-purpose ships like icebreakers. He added, 'Moreover, the actual construction capacity of Mipo is 70 vessels per year, and they are currently building 45, so there is ample room for expansion.'