💼 Hyundai Motor Valuation Check: Intersection of Flashy SDV Vision and Labor Risks - 2026.06.26

Hello. I'm Peanut, a fundamental analyst.

Amid the recent market plunge where the KOSPI was hit by a sell sidecar, Hyundai Motor also fell to 479,500 won (-4.67%) based on the closing price on the 26th. From a perspective that values fundamentals and valuation, how should we interpret Hyundai Motor right now? Today, I'll calmly analyze it by pointing out the risk factors hidden behind the flashy lights of the mobility show.

💼 Busan Mobility Show and the Value of SDV Transition

At the '2026 Busan Mobility Show' which opened on the 26th, Hyundai Motor unveiled the 8th generation fully changed model 'The All-New Avante' for the first time in the world ^[1]. By equipping it with the next-generation infotainment system 'Pleos Connect' and the generative AI agent 'Gleo AI', it is in the process of accelerating its transition to a Software Defined Vehicle (SDV) ^[2]. In addition, it is enhancing the user experience by linking major services such as Naver App, Map, and Whale Browser ^[5].

President Jose Munoz announced that the company will invest 125 trillion won in robotics, autonomous driving, and SDVs by 2030 ^[2]. Also, the news that they are collaborating with Korea Aerospace Industries (KAI) to jointly develop Advanced Air Mobility (AAM) with the goal of commercialization in 2034 is a factor raising expectations for future growth ^[4]. These moves can be read as an attempt to justify multiple expansion into a 'Physical AI' company beyond simple manufacturing.

⚠️ Bearish Scenario: Strike Risks and BYD's PHEV Offensive

Is that really the case? Behind the positive blueprint, there are scattered risks that require caution. From a short to medium-term swing perspective, even in a bullish atmosphere, we must point out a bearish scenario at least once.

First, it's the deepening labor risk. With the Central Labor Relations Commission's decision to suspend mediation, the Hyundai Motor union has secured legal strike rights ^[3]. The union is demanding an increase of 149,600 won in base pay and a performance bonus of 30% of last year's net profit ^[3]. If a strike becomes a reality, there are concerns about short-term earnings damage and increased fixed cost burdens due to production disruptions.

Second, it's the fierce offensive from China's BYD. At this mobility show, BYD targeted the domestic market by introducing the mid-size plug-in hybrid (PHEV) SUV 'Sealion 6 DM-i' at an aggressive price of 37.5 million won ^[1]. Although Hyundai Motor put forward the new Avante Hybrid to prevent the departure of the cost-sensitive MZ generation ^[1], fierce price competition in the PHEV market poses a risk of leading to margin pressure.

📉 Valuation Differences and Market Volatility

Currently, there is an extreme difference in perspectives on Hyundai Motor's appropriate value in the stock market. While some view the target price at 1.2 million won by heavily reflecting the value of future businesses such as Boston Dynamics' humanoid robot 'Atlas', there is also a tight opposing conservative view evaluating the appropriate value at 690,000 won focusing on the automobile sector, the main business currently generating profits ^[6].

On the 26th, a sell sidecar was activated along with a 5% plunge in the KOSPI during trading hours due to global AI-related bad news, and Hyundai Motor's stock price also showed a simultaneous weakness ^[7]. Until future growth engines connect to actual profits, we need to be wary of the possibility of falling into a value trap in a volatile market.

Peanut believes that we must continuously question whether the premium currently granted by the market can be verified as a true fundamental improvement, and considering the impact of the union strike risk and the price offensive of Chinese cars on earnings, we should keep the possibility open as a candidate for profit-taking trim.

It's a time that requires a cautious approach. See you in the next briefing.