HD Hyundai Infracore Rallies on Revenue Growth Expectations

By Kwanwoo Jun

HD Hyundai Infracore's shares rose sharply Monday, leading the strong rally in construction-equipment makers on expectations of solid revenue growth.

Shares of the South Korean maker of excavators, wheel loaders, dump trucks and vehicle engines were last 13% higher at 11,230 won ($8.60), outperforming the benchmark Kospi index's 0.6% gain in afternoon trading.

The stock was on course for its sharpest daily percentage gain in nearly two months, according to FactSet.

HD Hyundai Infracore stands to gain from a boom in infrastructure investments, especially in North America; brisk mining projects for electric-vehicle battery materials in Latin America or Southeast Asia; and new, large-scale construction plans in the Middle East, Hi Investment & Securities analyst Lee Sang-hun said in a note Monday.

A recent series of U.S. bills in support of federal funding to build or repair bridges, roads, power grids and other major infrastructure projects has been and will be a boon to Korean construction-equipment makers, which struggled with the sluggish Chinese real-estate market, the analyst noted.

HD Hyundai Infracore has successfully reduced its business focus on China and shifted it to North America and elsewhere for growth, he added.

The analyst was also upbeat on HD Hyundai Infracore securing a contract recently to supply engines to sister defense company Hyundai Rotem for K2 military-tank exports to Poland and expected more similar defense deals to come.

Write to Kwanwoo Jun at [email protected]

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