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Hyundai Motor's Q4 profit almost halves amid rising prices of raw materials

Analysts warn that soaring prices of raw materials, component shortages and logistical bottlenecks caused by the Covid-19 pandemic are likely to further drive up costs in the current quarter

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Hyundai | Hyundai Motor India

Reuters 

Hyundai

South Korea's Motor Co reported a nearly 50% drop in quarterly profit on Tuesday, falling significantly short of analysts' estimate, hurt by rising raw material costs and a one-off expense associated with employees' bonuses.

Motor, which together with affiliate Kia Corp is among the world's top 10 automakers by sales, reported a net profit of 547 billion won ($456.32 million) for October-December, versus 1.1 trillion won a year earlier.

That compared with an average analyst forecast of 1.5 trillion won compiled by Refinitiv SmartEstimate.

Analysts warn that soaring prices of raw materials, component shortages and logistical bottlenecks caused by the COVID-19 pandemic are likely to further drive up costs in the current quarter.

"It's hard to find a commodity for which prices are not rising and the situation is not expected to change in the foreseeable future," Lee Jae-il, an analyst at Eugene Investment & Securities, said before the were announced.

Shares in Motor fell 2.6% as of 0525 GMT, versus the benchmark KOSPI's 2.7% fall.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Tue, January 25 2022. 11:51 IST
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