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The writer is an analyst at KB Securities. He will be reached at seongjin.kang@kbfg.com. — Ed.
Increase goal worth to KRW800,000; HMG solely participant capable of rival Tesla
We elevate our TP by 158% to KRW800,000 (6.8% WACC; 0.7% TGR) and keep BUY on HMC. Boston Dynamics shall be a watershed second for productiveness innovation, in our view. Our DCF-based TP implies KRW164tn market cap, which features a KRW35tn oblique stake in Boston Dynamics, KRW69tn in legacy auto enterprise and KRW60tn in autonomous-driving foundry enterprise leveraging humanoids. We see HMC going full-fledged into the completion of its autonomous-driving foundry, underpinned by productiveness innovation. Given its strategic collaboration with Google Gemini Robotics AI (“brains”), huge manufacturing unit knowledge with Hyundai Motor Group, fast decision-making construction and mass-production capabilities, HMG is the one participant capable of rival Tesla within the bodily AI market, in our view.
Boston Dynamics: KRW128tn worth (KRW35tn HMC stake), 2035E OP at KRW62tn
We worth Boston Dynamics (27% HMC stake) at KRW128tn (DCF; 15.5% WACC; 3% TGR). Over the subsequent decade, the OECD+China working-age inhabitants ought to fall 52m, implying 9.6mn humanoids/12 months produced by 2035 to fill the hole. If Boston Dynamics takes 15.6% (1.5mn), we see its 2035 income/OP at USD288.3bn (KRW404tn)/USD44.3bn (KRW62tn).
Humanoids may enhance productiveness threefold, manufacturing capability fourfold
Assuming a three-shift 24-hour system, humanoids may enhance productiveness threefold. If HMC operates 100k humanoids (buying ~33k per 12 months), manufacturing capability may broaden fourfold. As unit costs decline, structural price competitiveness ought to strengthen. Among the many high 20 international auto OEMs, solely HMG and Tesla have clearly articulated large-scale adoption.
Count on OP increasing over twofold to KRW24.5tn in 2036, mid-/long-term market cap above KRW200tn mark
We see HMC OP increasing over twofold (KRW11.7tn in 2030→KRW24.5tn in 2036), with mid-/long-term market cap reaching KRW229tn (KRW1.12mn per share), above the KRW200tn mark.
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