Hyundai Motor Securities aims to achieve over $76mn in OP for a 4th year

Hyundai Motor Securities Co.’s office building. [Courtesy of Hyundai Motor Securities]

Hyundai Motor Securities Co., the brokerage arm of South Korea’s Hyundai Motor Group, is likely to achieve more than 100 billion won ($76 million) in operating profit this year, to mark the fourth year of achieving the milestone on the back of preemptive risk management.

According to data from the Financial Supervisory Service (FSS) on Thursday, Hyundai Motor Securities earned 53 billion won in operating profit for the first half of this year. If the robust performance trend continues, the brokerage company is likely to achieve an operating profit of more than 100 billion won this year.

In 2020, Hyundai Motor Securities posted 117.4 billion won in operating profit under the leadership of President Choi Byung-chul. It was the first time the company achieved over 100 billion won in annual operating profit. In the following year, Hyundai Motor Securities managed to post 156.5 billion won in operating profit and 114.6 billion won in 2022.

The company’s strong risk management and profit-diversification strategies have contributed to robust earnings, despite growing uncertainty in the financial sector.

Hyundai Motor Securities said its prominent investment bank division suffered a 58 percent decline in net operating revenue during the first half compared with the previous year.

However, the decline was offset by increases in overall earnings across the divisions.

The retail division saw a 27 percent rise in net operating revenue in the first six months of this year on the back of a rise in transactions and enhanced customer marketing.

“We managed to offset a portion of the downturn in the performance of the IB division, which constitutes up to 50 percent of the overall net operating revenue, by maintaining a diversified portfolio,” said an unnamed representative from the company. “In the latter half of the year, the IB segment aims to enhance the diversity of its portfolio using the investment capacity acquired during the preceding six months.”