[Edaily Reporter Kwon Oh Seok ] SANGSANGINVESTMENT&SECURITIES announced on the 20th that it is maintaining its “Buy” investment rating and target price of 170,000 won for HYUNDAI ROTEM(064350).

Lee SEOYON, an analyst at SANGSANGINVESTMENT&SECURITIES, stated, “HYUNDAI ROTEM’s third-quarter consolidated results fell short of market expectations, with revenue of 1.6207 trillion won (+0.1% year-over-year) and operating profit of 247.1 billion won (-11%). This discrepancy is interpreted as resulting from the fact that the reversal of provisions for contingencies—which was expected due to the early delivery of the Polish EC2 (second contract) order—was smaller than anticipated.”
She added, “The volume delivered in Q3 (third contract) is estimated to be a total of 14 units for the initial EC2 shipment. While this is smaller than previously anticipated, we expect the annual projected delivery volume of 58 units to be comfortably achieved.”
The analyst projected that the company’s 2027 defense performance will be driven primarily by the Poland EC2 contract and domestic mass production projects, and that sustained medium- to long-term growth will be possible if significant orders materialize from the K2 export pipeline. HYUNDAI ROTEM is currently pursuing a follow-on EC3 contract with Poland, and export negotiations with Peru are also underway, targeting the first half of 2027.
The analyst explained, “In the cases of Iraq and Romania, where projects have been delayed due to political uncertainty, we expect progress in order discussions as each country is set to appoint a new defense minister and a new prime minister, respectively.”
Earlier, the company announced the acquisition of HYUNDAI WIA’s Special Business Division alongside its earnings release the previous day. He added, “Through this acquisition, we will be able to strengthen cost competitiveness and secure export competitiveness by vertically integrating the production of gun barrels, a key component of the K2 tank,” and noted, “Amid ongoing expansion of corporate value, a full-scale turnaround in the stock price is possible depending on whether order momentum materializes.”