Kiwoom Securities maintained its target stock price of 950,000 won and its investment opinion of "buy", saying that the supply and demand of tire codes for Hyosung Advanced Materials is expected to remain tight next year.
"Demand for tire codes is also expected to increase as the market for front tires is expected to increase about 6% next year from this year to KRW 1.76 billion due to the increased penetration rate of COVID-19 vaccines and eased supply and demand of semiconductors for vehicles," Kiwoom Securities said.
"The PET (Polyester) tire code, which Hyosung Advanced Materials has an unrivaled global market share, is expected to maintain tight supply and demand following this year despite the expansion of its domestic competitors by 19,000 tons next year," Kiwoom Securities said.
"The competitor's expansion is unlikely to have a significant impact on the increase in effective production capacity of PET next year due to the volume considering Kumho Tire's expansion in Vietnam in 2023.". Kiwoom Securities also said, "The production capacity of super fiber is expected to increase 93.5% from 5,350 tons last year to 10,350 tons in the second half of next year and exceed 10,000 tons.".
"The production capacity of carbon fiber is expected to increase from the current 4,000 tons to 6,500 tons in July next year," Kiwoom Securities said. "Amid growing demand for CNG fuel tanks and batteries in India and the U.S., it is due to an increase in orders due to the signing of long-term supply contracts with domestic hydrogen storage container companies.".
Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com
