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Photo = Yonhap news |
[Alpha Biz= Paul Lee] Yuanta Securities evaluated that Doosan Bobcat (241560) continues to experience a decline in its revenue due to weakened demand resulting from tariff concerns, but that the company's outlook may change in the medium to long term with potential interest rate cuts in major countries. The investment rating was maintained as 'Buy,' with the target price kept at ₩56,000, while the previous trading day's closing price was ₩48,300.
Yuanta Securities analyst Jang Yun-seok commented, "The construction machinery sector, including Doosan Bobcat, is facing a demand slowdown due to tariff concerns in North America, resulting in continued revenue shrinkage. However, we are maintaining the target multiple (PBR 0.94) based on the assumption of sales normalization in advanced markets, the largest construction machinery markets globally, by 2026."
Doosan Bobcat's Q1 2023 revenue is expected to have decreased by 12% year-on-year, amounting to ₩2.1 trillion, with operating profit expected to have fallen by 39% to ₩200 billion. Both revenue and operating profit were in line with consensus estimates.
Dollar-denominated consolidated revenue has declined for the sixth consecutive quarter due to reduced demand across all regions and product categories caused by U.S. tariffs and economic uncertainties. However, operating profit improved compared to the previous quarter due to restructuring efforts, stabilization of logistics costs, and increased production efficiency.
Jang expects that in Q2 2023, it will be difficult to see a year-on-year increase in revenue, as dealers are expected to remain cautious in their purchasing decisions due to concerns about U.S. tariffs and a potential economic slowdown.
Although Doosan Bobcat manufactures approximately 70% of its products sold in the North American market locally and is constructing a plant in Mexico as part of the USMCA, which reduces its tariff sensitivity compared to competitors, it will still face higher costs if tariffs are realized. This is because key components, including engines and industrial vehicles, are sourced from overseas.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
