Hyundai Motor India | Photocredit: Reuters
Purpose: £ 1,750
CMP: £ 1,583.65
We recently met the management of Hyundai Motor India (HMIL).
Key Takeways: The prospects of the domestic PV industry remain soft in the short term; HMIL retains the performance, stimulated by frequent product innovations that have also helped portfolio unitness (discounts at about 2-2.5 percent of ASP versus approximately 3.5-4 percent for industry); The hope for improved demand trends in a few quarters for the industry; HMIL’s well-timed capacity expansion (150k units that start from October-25) and improved product pipeline (including in ice, apart from 3 bees) would help capitalize Cy26; With the relief of the issue of the Red Sea (although not yet regulated), the export to the middle -east pick up and will probably retain the strong momentum (Central East and Africa Form 2/3 of export; HMIL export to the US are zero); India is positioned as a global hub for emerging markets; export to also guarantee sustainable use of optimum capacity; and stable raw materials, price increases that are being taken in January-25 (70-80 BPS) and control on discounts to help the sequential margin improvement in Q4-FY25.
We maintain ADD on HMIL with unchanged TP of £ 1,750 (rolled up) and largely unchanged estimates. We prefer MSIL because of better launching visibility (consult our HMIL IC – strong franchise, but high valuation in the midst of Gedempte Growthuit).
Published on April 7, 2025
