PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩300 per share · Prices as of the 2026-10-02 close
Hyundai Kongup, the longest-standing Hyundai Motor supplier, is offsetting domestic production disruptions with expanding US Georgia plant operations that are driving a profitability recovery.
FY2025 consolidated revenue reached KRW 367.9bn (+12.5%) and operating profit KRW 12.3bn (+13.2%), while owner net income fell 8.0% year over year to KRW 11.8bn.
Q1 and Q2 2026 operating profit rose sharply to KRW 5.5bn and KRW 6.3bn, respectively, year over year, reflecting logistics cost savings at the US subsidiary.
Domestic revenue declined in H1 2026 due to a Hyundai Motor production disruption tied to a fire at supplier Anjeon Industry and weak Genesis output, while the US subsidiary's share of consolidated revenue expanded from 5.7% to 10.5% year over year.
Kia's new Telluride began mass production at the Georgia plant in December 2025, with the company set to supply about KRW 160bn worth of parts over the next six years.
Shinyoung Securities issued a target price of KRW 7,000 with a Buy rating in a report dated September 1, 2026.
Hyundai Kongup, founded in 1969 and listed on KOSDAQ in 2013, is a specialist maker of automotive interior seating components and is regarded as Hyundai Motor's longest-standing supplier. It manufactures and supplies seat cushions and backs (seat pads), armrests, headrests, side pads, leg rests, and backboards.
As of 2024, product mix by revenue was estimated at seat pads 34%, armrests 30%, headrests 29%, and backboards and other items 8%, applied mainly to Genesis, Palisade, Grandeur, and Ioniq/EV6 models.
End customers are Hyundai Motor and Kia, with an indirect supply structure through Tier-1 seat makers such as Hyundai M-Seat, Lear Korea, and Adient Korea.
Production sites span domestic operations in Ulsan and Asan plus a global network including the LaGrange, Georgia plant in the United States and two subsidiaries in China. The company continues R&D and quality-improvement activities to meet OEM requirements on quality, delivery, and cost competitiveness.
It has secured revenue visibility through multiple long-term supply contracts, including the new Palisade (about KRW 340bn over six years) and new Santa Fe (about KRW 140bn over six years).
Domestic peers competing in the OEM seat and interior parts market include Seoyon E-Hwa, Daewon Industry, Pyung Hwa Industry, and NVH Korea.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩98.5B | ₩6B | 6.1% |
| 2025Q3 | ₩86.4B | ₩4.4B | 5.1% |
| 2025Q4 | ₩98.8B | ₩1.1B | 1.1% |
| 2026Q1 | ₩91.2B | ₩5.5B | 6.0% |
| 2026Q2 | ₩85.5B | ₩6.3B | 7.3% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩278.5B | ₩15.1B | ₩11.4B | 5.4% | 8.4% | 51.3% |
| 2023 | ₩307.5B | ₩15.4B | ₩13.1B | 5.0% | 9.1% | 59.5% |
| 2024 | ₩326.9B | ₩10.9B | ₩12.9B | 3.3% | 8.4% | 46.2% |
| 2025 | ₩367.9B | ₩12.3B | ₩11.8B | 3.3% | 7.3% | 60.1% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23
FY2025 consolidated revenue rose 12.5% year over year to KRW 367.9bn from KRW 326.9bn, and operating profit grew 13.2% to KRW 12.3bn, yet owner net income declined 8.0% to KRW 11.8bn.
Operating margin held at 3.3% in both 2024 and 2025, below the 5.4% and 5.0% recorded in 2022 and 2023, indicating persistent cost and logistics pressure.
By quarter, Q3 2025 revenue was KRW 86.4bn with operating profit of KRW 4.4bn, yet owner net income of KRW 6.3bn exceeded operating profit, while Q4 2025 revenue of KRW 98.8bn saw operating profit collapse to just KRW 1.1bn, showing significant margin compression.
In 2026, operating profit recovered to KRW 5.5bn in Q1 and KRW 6.3bn in Q2, with Q2 owner net income reaching KRW 10.6bn, the highest of the recent quarterly window.
According to Newspim, Q1 2026 operating profit surged roughly 594% year over year, attributed to production stabilization at the US subsidiary and a shift toward sea freight that lowered logistics costs.
Cumulative H1 2026 results showed revenue of KRW 176.7bn, operating profit of KRW 11.8bn, and net income of KRW 15.6bn; while revenue fell 3.3%, operating profit and net income jumped 72.3% and 254.4%, respectively.
However, full-year 2025 operating cash flow was negative KRW 9.0bn, worse than 2024's negative KRW 0.2bn and a reversal from the strongly positive flows of 2022 and 2023 (KRW 19.8bn and KRW 34.0bn), suggesting that profit improvement has not yet translated into cash generation.
Recurring quarters where net income exceeds operating profit by a wide margin—Q3 2025 and Q2 2026—point to contributions from non-operating items.
The auto industry is navigating a simultaneous expansion of US local production and rising tariff burdens.
Hyundai Motor Group is building out the Metaplant America (HMGMA) in Georgia—combined with Hyundai's Alabama plant and Kia's Georgia plant—into a roughly one-million-unit annual US production system, and plans to establish mixed EV/hybrid production lines in the second half of the year.
However, Hyundai Motor and Kia paid roughly KRW 3.3 trillion in US tariffs in H1 alone, pressuring group-wide profitability, a variable that indirectly affects the cost structure of suppliers such as Hyundai Kongup.
Amid this backdrop, Hyundai Kongup is noted as the only supplier producing premium interior parts locally in the United States, expanding Georgia plant operations in step with the parent group's North American localization strategy.
On the domestic side, a temporary production disruption from a fire at supplier Anjeon Industry, combined with weak Genesis domestic output, weighed on H1 domestic revenue, illustrating the industry's structural reliance of parts makers on a single OEM's production schedule.
Competitively, the company vies for vendor status against domestic peers such as Seoyon E-Hwa, Daewon Industry, and Pyung Hwa Industry, with new-model contract wins shaping medium-term revenue allocation.
The ongoing EV chasm, in which hybrid models are driving OEM revenue, also shapes demand patterns for seat and interior components.
The company stated that from the second half, performance growth is expected to continue as new-model mass production effects from major OEMs are reflected.
Shinyoung Securities assessed that the H1 domestic revenue decline was a temporary factor tied to the Anjeon Industry fire and weak Genesis output, forecasting that from Q4 onward, the new Tucson and GV90 models, along with expanded HEV lineups restoring Genesis volume and offsetting Hyundai's production disruption, would drive a recovery in domestic revenue.
The Georgia LaGrange plant is supplying parts for Kia's new Telluride, with approximately KRW 160bn in supply scheduled over the next six years, and the company expects North American revenue contribution to gradually rise as production volume expands.
The company explained that as the local production system for Telluride-related parts becomes established, cost competitiveness is also improving.
Domestically, revenue recognition from already-secured long-term contracts—the new Palisade (KRW 340bn over six years) and new Santa Fe (KRW 140bn over six years)—is set to continue.
A company representative stated a plan to sustain growth momentum in H2 through new model introductions and improved profitability at the US subsidiary.
The current share price is understood to trade at a discount to net asset value, and market re-rating appears limited so far despite ongoing profit improvement.
Given that operating margin remained below 2022–2023 levels through 2024–2025 before showing signs of recovery in H1 2026, future valuation discussions may hinge on whether this margin recovery proves durable.
On dividends, Shinyoung Securities assessed that maintaining last year's payout level could support a meaningful dividend yield and issued a target price of KRW 7,000 with a Buy rating in a report dated September 1, 2026. This, however, reflects one brokerage's individual view rather than a broad market consensus.
The shift to negative operating cash flow in 2025 is a factor worth weighing alongside the share price relative to net assets.
PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-08-23
The US subsidiary's share of consolidated revenue expanded from 5.7% to 10.5% year over year, and a shift from air to sea freight contributed to a sharp rise in operating profit in Q1–Q2 2026. Localized production for Kia's new Telluride parts is also improving cost competitiveness.
This localization aligns with the parent group's strategy to ease tariff and incentive burdens, potentially becoming a structural growth driver.
Multiple long-term supply contracts are already secured, including the new Palisade (KRW 340bn over six years), new Santa Fe (KRW 140bn over six years), and Kia Telluride (KRW 160bn over six years). Shinyoung Securities forecast that from Q4, the new Tucson, GV90, and expanded HEV lineup would restore Genesis volume.
A contract structure spanning multiple models and regions can provide some buffer against weakness in any single model.
Shinyoung Securities assessed that a stable balance sheet—net cash of KRW 13.2bn and a debt dependency ratio of 6% as of end-Q2—supports sufficient capacity to maintain dividends. Cumulative H1 net income rose 254.4% year over year, also improving the resource base for dividends. The low debt burden could provide flexibility for future investment or shareholder return policy.
Revenue is concentrated on Hyundai Motor and Kia, exposing results directly to fluctuations in their domestic production schedules. Indeed, a fire at a fellow supplier combined with weak domestic Genesis output led to a decline in H1 Korean revenue.
A structural risk exists in that a production disruption at a single OEM group is directly reflected in the parts maker's revenue.
Q4 2025 saw operating profit of just KRW 1.1bn on revenue of KRW 98.8bn, sharply compressing margin, while Q3 2025 and Q2 2026 saw net income significantly exceed operating profit. Such quarterly variance—driven by logistics costs, tariffs, and non-operating items—reduces earnings predictability. Full-year operating margin also remained at 3.3% in 2024–2025, below the 5.0–5.4% recorded in 2022–2023.
2025 operating cash flow was negative KRW 9.0bn, worse than 2024's negative KRW 0.2bn, in contrast to the strongly positive flows of 2022 and 2023 (KRW 19.8bn and KRW 34.0bn). If profit improvement is not accompanied by cash generation, working capital burdens such as inventory or receivables could accumulate.
Whether cash flow improves is a point that warrants continued monitoring in future financial stability assessments.
Since most revenue is tied to Hyundai Motor and Kia production volumes, external variables such as sales slumps, strikes, or fires at fellow suppliers directly transmit to results. The H1 decline in domestic revenue illustrated this structural vulnerability. Delays in new model launches or changes in volume allocation also remain potential risks.
Hyundai Motor and Kia reportedly paid roughly KRW 3.3 trillion in US tariffs in H1, weighing on the entire group's profitability. Changes in tariff policy or origin rules could also affect the cost structure of Hyundai Kongup's US local production. Policy variables represent an external risk beyond the company's direct control.
Logistics costs, raw material prices, and foreign exchange fluctuations have been cited as key causes of quarterly margin variance. The sharp operating margin decline in Q4 2025 shows that such cost factors can weigh heavily within a short period. Expanding US production also increases dollar exposure in tandem.
Check whether Q3 2026 results show a recovery in domestic revenue and continued margin improvement at the US subsidiary.
Confirm whether mass production of the new Tucson and GV90, along with Genesis volume recovery from HEV lineup expansion, materializes as forecast by Shinyoung Securities.
Track the expansion of Telluride parts production at the Georgia LaGrange plant and the quarterly trend in the US subsidiary's share of revenue.
Check whether the board's dividend decision based on FY2026 results maintains the prior year's payout level.
If US tariff rates or origin-rule changes are announced, assess their impact on the company's US production cost structure.
Hyundai Kongup operates its domestic and overseas seat and interior parts business on the back of a stable, large customer base in Hyundai Motor and Kia, and since 2025 the expansion of Georgia plant operations has emerged as a key performance variable.
FY2025 revenue and operating profit rose year over year, yet owner net income actually declined, and quarterly results showed a stark contrast between a sharp Q4 margin drop and a clear recovery in H1 2026.
H1 domestic revenue fell due to a supplier fire and weak Genesis output, but this was substantially offset by the expanding US subsidiary revenue share and logistics cost savings. The fact that operating cash flow was negative in both 2024 and 2025 is a point to monitor separately from profit improvement.
Multiple long-term new-model supply contracts and low debt dependency support medium-term revenue visibility and financial stability, but heavy reliance on a single OEM group and shifting trade conditions remain variables requiring ongoing management.
The target price and dividend outlook presented by Shinyoung Securities offer one market perspective for reference, but as an individual brokerage's judgment, it should not serve as the final basis for investment decisions.
Report written 2026-09-05 · Data as of 2026-09-04
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