1. HME’s 2025 Performance Outlook: Can it Maintain Strong Q3 Results?

HME has shown remarkable growth up to Q3 2025. Thanks to increased demand for marine engines and high production capacity utilization, it achieved a 35% year-on-year increase in revenue and a significant increase in operating profit. However, the projected annual revenue of KRW 396 billion appears somewhat conservative considering the Q3 performance. Can HME maintain this growth momentum through the end of the year?

2. HME Investment Risk Analysis: What Factors Could Hinder Growth?

  • Increasing Dependence on the Chinese Market: A downturn in the Chinese shipbuilding market could severely impact HME’s performance. A thorough analysis of the declining China Containerized Freight Index is necessary.
  • Rising Volatility in Raw Material Prices: Increasing prices of raw materials such as steel and crude oil are putting pressure on HME’s profitability. The rising Baltic Dirty Tanker Index is also adding to cost burdens.
  • Exchange Rate Volatility: Fluctuations in the KRW/USD and KRW/EUR exchange rates significantly affect HME’s profitability as an exporting company. Therefore, its foreign exchange risk management strategy needs to be reviewed.
  • Potential for a Global Recession: Interest rate hikes and a potential recession in the US and Europe could lead to decreased demand in the shipbuilding market, negatively affecting HME’s performance.

3. HME Investment Strategy: Seizing Opportunities Amidst Uncertainty

HME is focusing on securing future growth engines, such as investing in eco-friendly engines. It remains to be seen whether these efforts will lead to enhanced market competitiveness. It is also important to check the 2025 annual operating profit and net profit forecasts, which have not yet been released, and to reassess HME’s financial stability. Before making any investment decisions, exercise caution and consult the latest market information and expert opinions.