PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩75 per share · Prices as of the 2026-10-02 close
Hwaseung R&A, a supplier of weatherstrip and hose rubber components to automakers, has posted four consecutive quarters of net profit through Q2 2026 after a net loss in Q2 2025, marking a recovery phase in earnings.
Revenue rose for four straight years, from KRW 657.9 billion in 2022 to KRW 714.6 billion in 2025.
The operating margin peaked at 4.7% in 2023 before declining for two straight years to 4.4% in 2024 and 3.8% in 2025.
Net profit attributable to owners was a loss of KRW 2.9 billion in Q2 2025 but turned profitable for the following four quarters through Q2 2026.
The debt ratio improved for four consecutive years, falling from 356.0% in 2022 to 187.6% in 2025.
The company has a track record of expanding orders from local and global automakers in emerging markets including India, Vietnam, and China.
Hwaseung R&A is an automotive rubber component specialist under the Hwaseung Group, organized around two main businesses: Sealing Products and Fluid Products. The flagship sealing item, weatherstrip, blocks noise, rainwater, and dust from entering the vehicle at door and trunk joints.
Fluid products include air-conditioning refrigerant hoses, brake hydraulic hoses, and radiator hoses. The company operates a vertically integrated structure in which affiliate Hwaseung Sochae supplies rubber raw material while Hwaseung R&A manufactures the finished parts.
Its major customers include Hyundai Motor, Kia, GM, FCA (now Stellantis), BMW, and Volkswagen, and it has also secured supply contracts with a Chinese electric-vehicle brand.
The company is known to operate 13 overseas subsidiaries with an export share reaching around 60% of sales, underpinning a global production and supply network.
The shift toward electrification is also reshaping its product mix: some parts such as radiator hoses and fuel hoses are not used in EVs, while EVs require separate coolant rubber piping for battery temperature management. Hyundai Motor Group is known to hold a 2.63% stake in Hwaseung R&A through Hyundai Mobis.
In emerging markets, its Indian subsidiary HSI Auto secured a contract with Mahindra & Mahindra to supply glass-run channels, weatherstrips, and other body sealing parts for a mid-size electric SUV, and the company has also won orders from Vietnamese automaker VinFast, marking its entry into Southeast Asia.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩181.6B | ₩5.4B | 2.9% |
| 2025Q3 | ₩174.7B | ₩10.3B | 5.9% |
| 2025Q4 | ₩185B | ₩3.7B | 2.0% |
| 2026Q1 | ₩184.7B | ₩9.1B | 4.9% |
| 2026Q2 | ₩201.2B | ₩10.6B | 5.2% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩657.9B | ₩15.5B | ₩12.7B | 2.4% | 13.7% | 356.0% |
| 2023 | ₩680.7B | ₩31.8B | ₩24.2B | 4.7% | 21.5% | 282.8% |
| 2024 | ₩707.1B | ₩31.3B | ₩32.4B | 4.4% | 21.5% | 212.3% |
| 2025 | ₩714.6B | ₩27.1B | ₩18.2B | 3.8% | 10.9% | 187.6% |
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
Annual revenue rose for four straight years, from KRW 657.9 billion in 2022 to KRW 680.7 billion in 2023, KRW 707.1 billion in 2024, and KRW 714.6 billion in 2025.
Operating profit, however, improved sharply from KRW 15.5 billion (2.4% margin) in 2022 to KRW 31.8 billion (4.7%) in 2023, then declined for two consecutive years to KRW 31.3 billion (4.4%) in 2024 and KRW 27.1 billion (3.8%) in 2025, meaning profit growth failed to keep pace with revenue.
Net profit attributable to owners increased from KRW 12.7 billion in 2022 to KRW 24.2 billion in 2023 and KRW 32.4 billion in 2024, before falling to KRW 18.2 billion in 2025, indicating a year in which non-operating factors weighed heavily.
On a quarterly basis, Q2 2025 posted operating profit of KRW 5.4 billion yet a net loss attributable to owners of KRW 2.9 billion, suggesting that foreign-exchange or equity-method items played a significant role between operating and bottom-line results.
The company then returned to net profit for four consecutive quarters: Q3 2025 (operating profit KRW 10.3 billion, net profit KRW 9.9 billion), Q4 2025 (KRW 3.7 billion, KRW 6.2 billion), Q1 2026 (KRW 9.1 billion, KRW 10.9 billion), and Q2 2026 (KRW 10.6 billion, KRW 8.2 billion).
Summed over the most recent four quarters (Q3 2025 through Q2 2026), net profit attributable to owners reached KRW 35.2 billion, exceeding any full-year figure recorded between 2022 and 2025. Operating cash flow also improved markedly, from a deficit of KRW 7.8 billion in 2024 to KRW 49.9 billion in 2025.
The debt ratio fell for four consecutive years, from 356.0% in 2022 to 282.8% in 2023, 212.3% in 2024, and 187.6% in 2025, reflecting a steady improvement in the balance sheet.
South Korea's auto parts industry is a typical order-based, direct-supply business heavily dependent on the production plans and export volumes of automakers such as Hyundai Motor and Kia.
Because of the direct-supply structure with automakers, parts suppliers' results tend to lag automaker sales and production cycles, and Hwaseung R&A is similarly exposed to domestic and overseas vehicle production trends.
The shift to electrification brings a two-sided change for sealing and hose suppliers: demand for internal-combustion-only parts such as fuel hoses declines, while new demand emerges for coolant rubber piping used in battery thermal management.
Competitively, Hwaseung R&A has a long track record and a history of simultaneously supplying multiple automakers in the weatherstrip and hose segments, though it remains relatively small in scale compared with larger domestic parts makers.
In emerging markets, the company is understood to have broadened its customer base among local and global automakers in growth markets such as India, Vietnam, and China. Changes in tariff and trade policy, however, are a variable for parts suppliers with overseas manufacturing bases.
In July 2026, it was reported that India secured a lower tariff category in trade negotiations with the United States, exempting about 45% of its exports to the US—including auto parts—from an additional 10% tariff.
The remaining 55% of Indian exports face the additional 10% tariff, though India's commerce ministry stated its overall tariff rate remains lower than that applied to several other countries. This is a factor that could affect the export conditions of parts makers with production bases in India.
Through its Indian subsidiary HSI Auto, Hwaseung R&A has secured a contract to supply body sealing parts for Mahindra & Mahindra's electric SUV program, making further volume growth tied to India's EV expansion a point to watch.
Recent US-India tariff negotiations have resulted in a large portion of Indian exports, including auto parts, being exempted from an additional US tariff, and the Indian government has stated it continues talks toward an early conclusion of a comprehensive bilateral trade agreement.
However, the negotiations are not yet fully concluded and disagreements remain over tariffs on certain remaining items, meaning the final outcome could still affect the export economics of India-based production.
In the domestic market, weatherstrip and hose supply volumes are determined in line with Hyundai Motor and Kia's new model and EV launch schedules, so changes in automaker production plans are expected to feed directly into results.
On the balance-sheet side, the debt ratio has continued to decline for four consecutive years, creating conditions that could be relevant for future investment capacity or capital allocation policy.
The non-operating factors (such as foreign exchange and equity-method items) that drove the Q2 2025 net loss have appeared more stable over the subsequent four quarters, and whether this stability continues is a key point to monitor in coming quarterly results.
Domestic auto parts makers have generally tended to trade at multiples below net asset value, which is often interpreted as reflecting relatively lower earnings visibility and greater cycle sensitivity compared with automakers themselves. Hwaseung R&A has broadly followed this sector pattern.
That said, the return to net profit for four consecutive quarters following the Q2 2025 loss suggests it may be worth comparing the market's earlier assessment, formed during a period of weaker results, against the more recently improved earnings trend.
On the dividend side, the company has maintained a track record of cash dividend payments, though the future direction of dividend policy remains a variable that will depend on earnings stability.
The steady four-year decline in the debt ratio is a factor worth considering when assessing future capital-allocation capacity for investment or dividends.
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
After a net loss in Q2 2025, the company posted net profit attributable to owners for four consecutive quarters from Q3 2025 through Q2 2026. Cumulative net profit over this period reached KRW 35.2 billion, exceeding any single full-year result between 2022 and 2025.
Operating profit also improved, reaching KRW 9.1 billion in Q1 2026 and KRW 10.6 billion in Q2 2026, versus levels seen in the second half of 2025.
The debt ratio improved for four straight years, from 356.0% in 2022 to 187.6% in 2025. Operating cash flow also improved sharply, from a deficit of KRW 7.8 billion in 2024 to KRW 49.9 billion in 2025. Total equity grew from KRW 92.7 billion in 2022 to KRW 166.9 billion in 2025, expanding the capital base.
Indian subsidiary HSI Auto has a track record of winning orders for body rubber sealing parts for a Mahindra & Mahindra electric SUV. The company also supplied sealing parts to Vietnamese automaker VinFast, marking its entry into Southeast Asia, and has previously signed a supply contract with a Chinese EV brand.
This history of broadening its customer base into emerging automotive markets could help reduce dependence on any single automaker or region.
In Q2 2025, the company posted operating profit of KRW 5.4 billion yet a net loss attributable to owners of KRW 2.9 billion, indicating that foreign-exchange or equity-method items had a significant impact on results. This gap between operating profit and net profit could be a recurring structural characteristic going forward.
While revenue grew for four consecutive years between 2022 and 2025, the operating margin declined for two straight years, from 4.7% in 2023 to 3.8% in 2025. Revenue growth has not directly translated into profit growth, warranting a closer look at cost structure or product-mix factors that may be pressuring margins.
The India-US tariff negotiation has not yet been fully concluded, and disagreements remain over tariffs on certain remaining items. As a parts maker with overseas manufacturing bases, changes in tariff and trade policy across countries remain a structural risk that could affect export profitability.
Exports through the Indian production base are exposed to changes in US tariff policy; recent reports indicate some Indian export items have been exempted from additional tariffs while others remain subject to them. Since negotiations have not been finalized, future tariff adjustments could alter export profitability.
Fluctuations in raw material prices such as rubber and in foreign exchange rates can affect non-operating income, and the gap between operating profit and net profit in Q2 2025 illustrates the influence of such variables.
While the company has a raw-material supply arrangement through an affiliate, it cannot fully eliminate exposure to global commodity price and currency volatility.
Results are directly tied to the production plans and sales cycles of major automakers, including Hyundai Motor and Kia.
The electrification transition is shifting the product mix, reducing demand for internal-combustion-only parts while increasing demand for EV-specific components, and if the pace of this transition diverges from expectations, it could affect results.
Timing of the Q3 2026 quarterly report filing; worth checking whether the four-quarter streak of net profit and any operating margin improvement has continued.
Worth monitoring whether the US-India tariff negotiation reaches a final conclusion, and checking how any adjustment to tariffs on remaining items affects the export profitability of the India production base.
Worth checking for any news of additional orders or volume expansion related to the India Mahindra electric SUV program, and whether trading relationships in emerging markets such as Vietnam and China change.
Expected timing of the FY2026 annual results and dividend announcement, a point to check whether the debt-ratio improvement trend and dividend policy continue.
Hwaseung R&A is an auto parts manufacturer producing rubber components such as weatherstrips and hoses, supplying multiple domestic and overseas automakers including Hyundai Motor and Kia.
Revenue rose for four consecutive years from 2022 to 2025, but operating margin, after peaking at 4.7% in 2023, declined to 3.8% by 2025, meaning profit leverage failed to keep pace with revenue growth.
Following a net loss in Q2 2025, the company returned to net profit attributable to owners for four consecutive quarters through Q2 2026, with cumulative net profit over that span exceeding any prior full-year result.
The debt ratio has declined for four straight years and operating cash flow has improved, strengthening balance-sheet stability.
The company has a history of broadening its order base in emerging automotive markets such as India, Vietnam, and China, and progress in US-India tariff negotiations has recently emerged as a variable that could affect the export conditions of parts makers with production bases in India.
Overall, the company sits at a juncture where positive trends in revenue growth and earnings recovery coexist with risks from non-operating earnings volatility and trade-policy uncertainty.
Report written 2026-09-05 · Data as of 2026-09-04
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