Hyundai-Rotem: Earnings Have Climbed Sharply While the Share Price Has Fallen More Than 50% in a Year

Thesis

The data supports a strong operating record: five years of rising revenue, a margin that moved from 2.8% to 17.2% in 2025, and trailing return on equity of 29.6%. The balance sheet shows cash of ₩2.5T against borrowings of ₩135.5B, and trailing free cash flow is ₩1.7T.

The share price tells a different story. It is down 19.4% over one month, 41.2% over three months and 54.5% over one year, and trades at ₩100,000 versus a 52-week high of ₩282,000. News headlines dated 2026-10-13 refer to lowered next-year earnings estimates and uncertain order timing, which suggests the market is questioning the durability of earnings. The data does not give the underlying estimates, so the scale of any revision is not available.

Trailing operating margin of 15.9% is slightly below the 2025 level of 17.2%. Data on investor flows, foreign ownership and short balance is not available, so we cannot say who has been selling.

Business overview

Hyundai-Rotem Co (code 064350) is listed on the KOSPI in the transport equipment sector. It was founded on 1999-07-01, listed on 2013-10-30 and has 109,142,293 listed shares. Market capitalisation is about ₩10.9T and enterprise value is about ₩8.5T. The CEO is listed as 이용배.

The filings list shows several major sales or supply contract disclosures in September 2026 (on the 21st, 23rd and 30th), as well as IR events. The data does not give contract sizes or customers. News on 2026-10-13 mentions the company unveiling a Vietnam urban rail vehicle and a next-generation high-speed train model in Hanoi with a Vietnamese partner.

Financial analysis

These figures come from filed financial statements (DART). Revenue grew from ₩2.87T in 2021 to ₩3.16T in 2022, ₩3.59T in 2023, ₩4.38T in 2024 and ₩5.84T in 2025. Growth was 10.1%, 13.4%, 22.0% and 33.4% in 2022 to 2025.

Operating income rose from ₩80.2B in 2021 to ₩147.5B, ₩210.0B, ₩456.6B and ₩1.01T in 2025. Operating margin went 2.8%, 4.7%, 5.9%, 10.4% and 17.2%. Net income was ₩769.9B in 2025, and ROE was 30.1%.

Trailing twelve months to H1 2026: revenue ₩6.31T, operating income ₩1.00T (15.9% margin), net income ₩807.6B (12.8% margin), ROE 29.6%. Liabilities to equity is 169.1%. Cash is ₩2.53T, borrowings ₩135.5B and free cash flow ₩1.67T.

Valuation

Current multiples are a P/E of 13.5, P/B of 3.2 and P/S of 1.7, with a dividend yield of 0.6%. EV/EBITDA is not available.

Against its own history, the only year-end data points are for 2025, when P/E was 26.6 and P/B was 6.7. The current P/E and P/B are therefore roughly half of the 2025 year-end levels, mostly reflecting the lower share price alongside higher trailing earnings. Earlier year-end multiples are not available.

Peer comparison is limited. Four listed names are shown (Iljin Hysolus, INNOXCorporation, KR Motors, Alton), all with much smaller market caps (₩22.1B to ₩390.0B), and none has P/E or P/B data. A meaningful peer valuation comparison is not possible from this data.

Catalysts

• Advance notice of an earnings results disclosure was filed on 2026-10-01, pointing to upcoming results that will show whether margins are holding near the trailing 15.9%.
• Major sales or supply contracts were disclosed on 2026-09-21 (amended), 2026-09-23 and 2026-09-30, and further order announcements could matter given news focus on order timing.
• Company IR events on 2026-09-16 and 2026-10-01 may provide further information on the business outlook.
• On 2026-10-13 the company unveiled a Vietnam urban rail vehicle and a next-generation high-speed train model in Hanoi with a Vietnamese partner.
• News on 2026-10-13 reports lowered next-year earnings estimates by brokers, and any change in those views would be watched.

Risks

• The share price is down 54.5% over one year and sits near its 52-week low, showing strong negative momentum.
• Headlines cite uncertain order timing, which is a risk to the pace of revenue growth after a 33.4% rise in 2025.
• Trailing operating margin of 15.9% is below the 2025 level of 17.2%, so margin pressure may be emerging.
• Liabilities to equity of 169.1% is fairly high, even though borrowings are small relative to cash.
• Data on investor flows, foreign ownership and short interest is not available, so selling pressure cannot be assessed.

Closing view

The filed numbers show a company whose revenue, profit and returns have risen steadily for five years, with a large cash balance and small borrowings. The share price, however, has fallen sharply, and the multiples are now about half their 2025 year-end levels, reflecting market doubts about future earnings and order timing as shown in recent news. The data supports both a strong historical record and real uncertainty about what comes next. With no peer multiples, no flow data and no forward estimates in the dataset, the picture is incomplete, and upcoming earnings and order disclosures will be key evidence.

Model estimate of fair value

The valuation model has no estimate for this company yet (not enough data, or no positive value with the base case).

Report history

1. Oct 13, 2026InitiationHyundai-Rotem: Earnings Have Climbed Sharply While the Share Price Has Fallen More Than 50% in a Year