**”Shipping Contract Freight Increase Larger Than Expected”**,
(Seoul = Yonhap News) Reporter Kwak Youn-ah – Hyundai Glovis surged over 13% on the 2nd after announcing it had signed a maritime transport contract worth 6.7 trillion won with Hyundai Motor Company and Kia.
On this day in the stock market, Hyundai Glovis closed at 133,800 won, up 13.29% from the previous session.
The stock price once surged to 136,200 won, a 15.33% increase, during trading.
This strong performance seems to be due to Hyundai Glovis’ disclosure on December 31st that it had signed a complete vehicle maritime transport contract with Hyundai Motor Company and Kia for regions including America, Europe, the Middle East, and Asia.
The contract period is five years, with the contract size being 3.365 trillion won from Hyundai Motor and 3.334 trillion won from Kia, totaling 6.7 trillion won.
Jung Yeon-sung, a researcher at NH Investment & Securities, commented on the contract saying, “Hyundai Glovis will handle 50% of Hyundai and Kia’s domestic production volume. Although the volume share has decreased from the previous contract, considering Hyundai and Kia’s increased production, the absolute volume decrease is limited.”
Furthermore, he explained, “We assumed a 30% increase in freight rates for the complete vehicle transportation contract in Hyundai Glovis’ performance this year; however, judging from the contract size, the actual rate increase appears to exceed that assumption. It seems the long-term leased ships can be operated stably with sufficient profitability.”
Meanwhile, in the stock market on that day, Hyundai Motor Company closed at 211,500 won, down 0.24%, while Kia rose 0.89% to close at 101,600 won.