Hyundai Motor Announces Its Corporate Value Up Policies

• On 28 August, Hyundai Motor announced its Corporate Value Up policies, including a minimum dividend per share this year targeting 10,000 won per share for common shares.

• Hyundai Motor plans to implement a shareholder return policy based on a total shareholder return (TSR) of 35% or more from 2025 to 2027.

• Hyundai Motor's Corporate Value Up plan of providing TSR of 35% or more from 2025 to 2027 is certainly better than what it provided in the past three years (26%).

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On 28 August, Hyundai Motor (005380 KS) announced its Corporate Value Up policies, including a minimum dividend per share this year targeting 10,000 won per share for common shares. Hyundai Motor also plans to buy back 4 trillion won worth of shares over the next three years. Hyundai Motor plans to implement a shareholder return policy based on a total shareholder return (TSR) of 35% or more from 2025 to 2027.

It set a target for a three year average ROE of 11% to 12%. It also plans to increase quarterly dividend to 2,500 won per share, up from 2,000 won per share. Moreover, it plans to pursue more share buybacks and cancellations. In addition, it plans to pursue a mid-to-long-term operating margin of 10% or more to to continue to expand shareholder returns.

• In the past three years, the company's total shareholder returns averaged about 26% per year. Over a longer period (past 5 years from 2019 to 2023), its total shareholder returns averaged about 34% per year.

• Therefore, while the company's Corporate Value Up plan of providing TSR of 35% or more from 2025 to 2027 is certainly better than what it provided in the past three years, the new plan is slightly better as compared to the past five years (if the company keeps TSR at 35%).

• The extra alpha is that Hyundai Motor has mentioned the TSR will be 35% or MORE which could result in greater returns to the shareholders.