[Edaily Reporter Park Soon-yeop] An analysis suggests that the recent rise in stock prices of major Hyundai Motor Group automotive stocks is now driven more by expectations for robotics than by improvements in their core businesses. Rather than increasing exposure to the automotive sector as a whole, the analysis recommends a stock-by-stock approach to identify the actual beneficiaries of the robotics business, particularly those centered around Boston Dynamics (BD).
Kim Yong-min, an analyst at Yuanta Securities, stated in a report on the 16th, “We maintain a neutral view on the opinion that a revaluation has taken place for existing businesses such as hybrid vehicles (HEV), electric vehicles (BEV), autonomous driving, software-defined vehicles (SDV), hydrogen vehicles, and robotaxis,” “Since the rise in stock prices is clearly driven by robotics-related events, it is crucial to identify the key beneficiaries within the sector.”

Yuanta Securities maintained its “Neutral” investment rating on the automotive sector. However, it recommended adjusting portfolio weightings based on differences in sector preferences. #For Hyundai Motor, it downgraded its investment rating to Neutral and set a target price of 690,000 won. For #Hyundai Mobis, it maintained a ‘Buy’ rating and raised the target price to 870,000 won. It also changed its top pick within the sector from Hyundai Motor and Hyundai Mobis to Hyundai Mobis alone.
Analyst Kim pointed to Hyundai Motor’s role as the group’s control tower as the reason behind the recent widening gap in market capitalization and valuation between Hyundai Motor and #Kia. He explained that the fact Hyundai Motor is at the center of decision-making for new businesses—such as robotics—beyond being a mere automaker has been reflected as a premium.
In fact, Hyundai Motor’s 12-month forward price-to-earnings ratio (P/E) commands a premium of over 80% compared to Kia’s. This significantly exceeds the range of -9% to 35% that Hyundai Motor’s P/E premium relative to Kia has typically fluctuated within over the past decade.
The structure of research and development (R&D) expenses was also cited as a factor explaining Hyundai Motor’s premium. The gap in R&D-related spending between Hyundai Motor and Kia widened to approximately 1.8 trillion won as of last year. In particular, a higher proportion of Hyundai Motor’s R&D spending is capitalized as intangible assets compared to Kia. Analyst Kim noted, “Hyundai Motor holds the key to new business areas such as technologies, platforms, and intellectual property (IP) that will be utilized in the future,” adding, “Investments that were once viewed as a cost burden are now acting as a driver of the robotics premium.”
However, he noted that it is difficult to attribute Hyundai Motor’s stock price rise solely to the value of its stake in Boston Dynamics. While expectations surrounding robotics have boosted Hyundai Motor’s valuation, the potential for further stock price appreciation may depend on BD’s pre-IPO fundraising, changes in its equity structure, and where the actual benefits ultimately accrue.
Yuanta Securities predicted that Hyundai Motor Group and Chairman Chung Eui-sun would secure a 100% stake in BD following the exercise of SoftBank’s put options in June or July of this year. SoftBank’s stake in BD stood at 20% at the time of the 2021 sale but has since decreased to around 10% as of last year following a rights offering. Yuanta Securities estimated that the sale proceeds could range from a minimum of 707 billion won to 2.971 trillion won, based on the value of the recent rights offering, depending on the terms of SoftBank’s put option exercise.
This process could also increase the burden on Chairman Chung Eui-sun to contribute additional personal funds. Yuanta Securities estimated that, factoring in the exercise of the put option and a potential additional capital increase in the second half of the year, Chairman Chung’s cumulative investment in BD could rise from at least 1 trillion won to as much as 1.7 trillion won. Accordingly, while a partial sale of Chairman Chung’s existing shares may be unavoidable during BD’s initial public offering (IPO), a large-scale sale could weigh on investor sentiment; therefore, a reasonable stake sale is estimated to be limited to 3–6%.
The possibility of existing shareholders other than Chairman Chung participating in the sale of existing shares was also raised. Analyst Kim believed that #Hyundai Glovis is more likely to participate in the sale of existing shares than Hyundai Motor, Kia, or Hyundai Mobis. This is because, unlike the other three group companies, Hyundai Glovis has a relatively lower need to directly utilize humanoids in manufacturing operations, Chairman Chung holds a high stake in the company, and he holds a direct stake in BD rather than an indirect stake through a special purpose company (SPC).
Another key reason for naming Hyundai Mobis as a top pick is that the benefits of adopting humanoids may accrue more significantly to parts suppliers than to automakers. Yuanta Securities analyzed that for automakers adopting humanoids early on, initial purchase costs and depreciation burdens may arise. Conversely, it judged that for Hyundai Mobis, which supplies core components, this could present an opportunity to secure a leading position in the robotics hardware platform market.
Analyst Kim explained, “While Hyundai Motor and Kia are buyers of robots, Hyundai Mobis is both a buyer and a key supplier.” He added, “If we view the robotics industry not as a simple manufacturing sector but as a platform industry, securing a leading position in the hardware platform is the strongest justification for a valuation multiple premium.”
Factors that have previously weighed on Hyundai Mobis’ stock price include uncertainty regarding the future profitability of its parts business, which relies on captive orders, and concerns about downward pressure on the stock price during the medium- to long-term corporate governance restructuring process. However, the analysis suggests that in a situation where the robotics business acts as a trigger for stock price increases across the entire automotive sector, the position of a captive parts supplier could instead be reevaluated as that of a supplier of general-purpose robotics hardware platforms.
Analyst Kim emphasized, “We are currently seeing a situation where the stock price increases of specific companies within the sector are driven more by expectations of benefits from new businesses than by organic improvements in their core operations,” adding, “We need to be cautious of valuation methodologies that lag behind stock price increases, and it is even more important to identify the stocks that will actually benefit.”