After the announcement of corporate value enhancement support measures, Kia, which had been recognized as one of the representative low Price-to-Book Ratio (PBR) stocks and had shown an upward trend, surpassed Hyundai Motor, often referred to as its “big brother” within the group, in market capitalization on March 18.
According to the Korea Exchange on the same day, Kia concluded trading at 128,000 won (US$95.88), up 2.40 percent from the previous trading day, with a market capitalization of 51.46 trillion won, ranking fifth in the stock market, excluding preferred shares. In contrast, Hyundai Motor closed at 242,000 won, down 0.41 percent, with a market capitalization of 51.3 trillion won, securing the sixth position.
On the previous trading day, March 15, Hyundai was ranked fifth while Kia was sixth, but their positions have now switched. Just at the year’s end, Kia, with a market capitalization of around 39 trillion won, ranked seventh in terms of market capitalization. However, this year, Kia has seen a significant increase in market capitalization, exceeding 12 trillion won, demonstrating an upward trend. Kia had already surpassed Hyundai Motor on Jan. 31, rising to sixth place on the KOSPI, but Hyundai Motor later regained its lead. This marks the second time Kia has surpassed Hyundai Motor.
The rise in Kia’s stock price is attributed to its more aggressive shareholder return policy compared to Hyundai Motor. In terms of operating profit margins last year, Hyundai Motor recorded 9.3 percent, while Kia achieved a record high of 11.6 percent. Hyundai Motor and Kia have set their year-end dividends at 8,400 won and 5,400 won per share, respectively. Looking solely at year-end dividends, Kia’s dividend yield is higher compared to Hyundai’s. Additionally, Kia announced its plan to repurchase and retire approximately 500 billion won worth of treasury stocks, whereas Hyundai Motor plans to retire around 1 percent of its treasury stocks, which is at the 4 percent level of its existing holdings, annually.