[Edaily Reporter Shin Ha-yeon ] On the 29th, NH INVESTMENT & SECURITIES projected that HYOSUNG ADVANCED MATERIALS(298050)will see added growth driven primarily by carbon fiber, while its tire cord business continues to serve as a stable cash cow. Although the firm maintained its “Buy” investment rating, it lowered the target price from 320,000 won to 260,000 won to reflect the slower-than-expected recovery in the superfiber segment.

Choi Young-kwang, an analyst at NH INVESTMENT & SECURITIES, stated, “While the tire cord business continues to serve as a stable ‘cash cow,’ the trend of improving earnings driven by enhanced profitability in the superfiber segment remains valid,” adding, “Prices for major products, which had been on a downward trend for the past few years, are now bottoming out.”

The firm expects second-quarter earnings to exceed market expectations. NH INVESTMENT & SECURITIES forecasts consolidated second-quarter revenue of 8940억 won and operating profit of 612억 won. This represents year-over-year increases of 6.0% and 4.2%, respectively, while operating profit is projected to rise 77.8% quarter-over-quarter, surpassing the consensus estimate.

Analyst Choi explained, “The normalization of profitability in tire cord—driven by increased sales and the passing on of cost increases—will lead the improvement in earnings,” adding, “Even based solely on preliminary figures through June 20, the export volume of carbon fiber in the second quarter increased by 23% compared to the previous quarter.” He continued, “We attribute this to new demand from wind turbine blades and drones.”

Carbon fiber is expected to continue its growth momentum, driven by the acquisition of new customers and the effects of capacity expansions. Analyst Choi noted, “The company plans to commission new facilities in Vietnam (5,000 metric tons each) during the third quarter of 2026 and the first quarter of 2027,” adding, “The proportion of sales to China, where prices are low, will decrease, leading to an improvement in the product mix.”

However, the pace of recovery for superfibers was assessed to be slower than previously expected. He explained, “Considering that the recovery in superfiber prices and aramid demand is slower than previously anticipated, we have revised down our operating profit forecasts for 2026 and 2027 by 7.9% and 12.0%, respectively, compared to our previous estimates.”

In the medium to long term, he anticipated that prices for major products would stabilize and demand would continue to recover. Analyst Choi noted, “In the second quarter, the quarter-over-quarter change in export prices for tire cord and carbon fiber was 0.9% and -0.1%, respectively, while export volumes increased by 9% and 23%, respectively,” adding, “Prices for major products are bottoming out, while demand is on the rise.”