1. Q2 Earnings: A Mix of Growth and Profitability Decline
Hankook & Company reported a 2.89% year-on-year increase in consolidated revenue, reaching 732.438 billion KRW in Q2 2025. The battery business, particularly automotive batteries, drove this growth. However, operating profit decreased by 19.8% to 200.76 billion KRW, impacted by rising raw material prices and investments in the US plant.
2. Decoding the Operating Profit Decline
Rising raw material prices and investments in the US plant contributed to the short-term decline in profitability. However, from a long-term perspective, entering the US market is a strategic investment aligned with the expanding electric vehicle market.
3. Future Growth Drivers: Battery Business and US Market
Hankook & Company’s future hinges on the success of its battery business, especially in the US market. The rapid growth of the EV market fuels the demand for automotive batteries, and the US market is at the heart of this growth. Hankook & Company’s investment in the US plant aims to capture a larger market share.
4. Action Plan for Investors
Instead of focusing on the short-term profitability decline, investors should consider the long-term growth potential. Given the growth prospects of the battery business and its competitiveness in the US market, Hankook & Company remains an attractive investment. However, it’s crucial to monitor risk factors such as raw material price and exchange rate volatility, as well as increasing competition, and make informed investment decisions.