Three major Korean securities firms issued bullish stock analysis reports on July 15 morning, raising price targets for KT&G, Hanwha Aerospace, and Korean Air. Hana Securities upgraded KT&G's target price to 210,000 won citing strong domestic tobacco demand and favorable exchange rate effects. Korea Investment Securities maintained Hanwha Aerospace's 2 million won target, projecting second-half earnings improvement from overseas defense contracts. KB Securities raised Korean Air's target to 40,000 won, forecasting operating profit nearly double market expectations due to AI-driven cargo demand. The upgrades reflect analysts' assessment of improving business fundamentals across tobacco, defense, and aviation sectors in the Korean stock market.
Hana Securities Raises KT&G Target Price to 210,000 Won
Hana Securities raised its target price for KT&G to 210,000 won from 180,000 won, maintaining a 'buy' rating. The stock closed at 171,000 won on the previous trading day. Analyst Sim Eun-ju stated that strong domestic tobacco sales and favorable exchange rates will drive earnings growth visibility throughout the year. The firm raised its dividend forecast to 7,500 won per share. Sim noted that considering the dividend yield, short-term stock price movement is expected in a box range up to 190,000 won, but recommended a buy strategy on price corrections from a medium to long-term perspective given the company's active shareholder return policy.
Korea Investment Securities Projects Hanwha Aerospace Second-Half Earnings Growth
Korea Investment Securities maintained its target price of 2 million won and 'buy' rating for Hanwha Aerospace. The stock closed at 872,000 won. Analyst Jang Nam-hyun stated that while second-quarter operating profit may slightly miss consensus, earnings and orders have passed their bottom and will enter full-scale improvement from the second half. The analyst projected that ground defense operating profit will surge in the second half as revenue recognition from Poland, Egypt, and Australia projects begins in earnest. Jang anticipated resumption of business negotiations with Saudi Arabia's Ministry of National Defense, estimating a contract size exceeding 10 trillion won. The analyst highlighted that major catalysts including the U.S. self-propelled howitzer modernization project preferred bidder selection in July and UAE L-SAM export momentum are concentrated within this year.
KB Securities Upgrades Korean Air Target on AI Cargo Demand
KB Securities raised its target price for Korean Air to 40,000 won from 36,000 won, maintaining a 'buy' rating. The stock closed at 26,500 won. The firm raised its 2024 operating profit forecast for Korean Air to 1.7314 trillion won, up 20.4% from previous estimates and representing a 55.5% year-over-year increase. This figure is 99.8% above market consensus. Analyst Kang Sung-jin stated that air cargo market conditions driven by the AI investment boom are showing stronger performance than even positive expectations, projecting the company's operating profit will reach approximately double the market estimate. Kang added that while international oil prices are falling and fuel costs will decline rapidly, cargo rates will rise due to increased AI-related cargo demand and year-end freight volume, with freight rate strength expected to continue as global air cargo transport volume increases while capacity growth remains limited.
FAQ
What target price did Hana Securities set for KT&G stocks?
Hana Securities raised its target price for KT&G to 210,000 won from 180,000 won while maintaining a 'buy' rating. The stock closed at 171,000 won on the previous trading day.
Why did KB Securities upgrade Korean Air stocks?
KB Securities upgraded Korean Air's target price to 40,000 won citing exceptionally strong air cargo market conditions driven by AI investment demand. The firm projects Korean Air's 2024 operating profit will reach 1.7314 trillion won, nearly double market consensus estimates, due to rising cargo rates from increased AI-related freight demand.
