As of the morning of the 19th, Kumho Tire (073240) is trading at 5,940 won, down 160 won from the previous trading day, showing a downward trend. Hyundai Motor Securities expects the company to make up for production disruptions caused by the Gwangju fire through capacity expansion at other plants and outsourced production, while citing the cost of European tariffs on Chinese-made tires as an earnings variable.

◆ Q3 Operating Profit Forecast at 144.5 Billion Won... 0.2% Below Consensus

Hyundai Motor Securities' forecast for Kumho Tire's operating profit in the third quarter of 2026 is 144.5 billion won, a 33.2% increase from the same period last year, with an operating margin of 11.8% expected. This is 0.2% below the market consensus.

◆ Gwangju Fire Production Disruptions to Be Offset Through Capacity Expansion and Outsourced Production

Regarding production response, the company's moves following the Gwangju fire are drawing attention. Hyundai Motor Securities analyzed that Kumho Tire will compensate for the production disruption by increasing capacity at other plants and utilizing outsourced production. It projected that this will allow the company to achieve its business plan target of 5.1 trillion won in revenue without setbacks.

◆ European Tariffs on Chinese Tires Could Cause Earnings to Fall Short of Estimates Depending on Scale

However, the tariff burden was presented as a separate risk factor. The assessment is that if costs from Europe's tariffs on Chinese-made tires are imposed, earnings could fall short of estimates depending on their scale. This forecast is characterized by separately presenting the response to production disruptions and the impact of tariff costs. While the company is expected to continue its business plan through plant expansion and outsourced production, the judgment is that actual profits could vary depending on the size of the additional costs.

◆ Share Price Declining... Too Early to Pinpoint the Cause

Kumho Tire's share price showed a downward trend on this day. However, it is difficult to pinpoint the impact of production disruptions or tariff burdens on the stock price based solely on intraday price movements. Whether the Q3 operating profit and business plan targets are achieved will also need to be confirmed through future earnings announcements.

[This article was written with the assistance of AI and is not intended to solicit investment. Securities firms' earnings forecasts and business-related assessments may differ from actual results, and stock prices may fluctuate during trading. Investment decisions and the resulting responsibility rest with the investor.]