April 20, 2024

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Kia Motors’ stock price has risen close to the target price, said KB Investment and Securities on Feb. 19 downgrading its recommendation to a “hold” from a “buy” while maintaining 40,000 won (US$35.49) target price.

Its operating profit in the fourth quarter last year increased 26.3 percent on-year to 382 billion won but was 2.9 percent lower than market expectations. Profits gained from the same period the previous year due to the decline in sales warranty provision costs, and the improvement does not imply much, said analyst Kang Seong-jin.

The carmaker’s operating profit this year will hike 29.1 percent from last year to 1.5 trillion won but will miss market consensus. Its new SUV Telluride and revamped compact crossover Soul will propel sales in the US while incentives will be cut. Meanwhile its Indian factory will begin operations in the second quarter, earlier than planned, but will not contribute much to its 2019 earnings, added the analyst.

By Hwang You-mee (glamazon@heraldcorp.com)