Meritz Securities maintains 'Buy' rating, 250,000 won target amid 200 billion won annual fee impact
Kim Joonseong, a researcher at Meritz Securities, forecasted on the 15th that despite concerns over cost burdens for Hyundai Glovis due to the U.S. imposition of port entry fees, growth is expected to continue until 2026. Kim maintained the investment opinion 'Buy, Buy' and a target stock price of 250,000 won for Hyundai Glovis.
Starting from the previous day, automobile carriers entering U.S. ports have been subject to a port entry fee of US$46 per ton (t). Hyundai Glovis operates a 20,000-ton vessel, making approximately 200 round trips to the U.S. annually. Each entry incurs fees of up to 1.3 billion Korean won.
Given that the annual number of port entry fee impositions per vessel is limited to five times, Kim estimated the annual fee scale to be around 200 billion Korean won. Under contractual structures, port entry fees are the responsibility of the client companies.
The issue is the possibility that client companies may request Hyundai Glovis to bear the cost burden. Kim stated, "If 50% of the port entry fee is passed on to Hyundai Glovis by the client, it could reflect annual costs of 100 billion Korean won, and 25% could reflect 50 billion Korean won," adding, "This could serve as grounds to lower Hyundai Glovis's estimated net profit for 2026 by 5.1% and 2.6%, respectively."
However, Kim forecasted that Hyundai Glovis's growth momentum will continue. He particularly emphasized that within the industry, Hyundai Glovis's earnings forecasts are continuously being revised upward. He said, "Hyundai Glovis is expected to continue improving its performance by benefiting from the shortage of vehicle carriers originating from China," and added, "Based on Hyundai Glovis's estimated performance for 2026, the price-to-earnings ratio (PER; market capitalization ÷ net profit) is 5.7 times, which we judge to be an active buying range."