Nexen Tire's (002350) Q2 revenue increased by 10.8% year-on-year to 891.3 billion won, but operating profit decreased by 19.5% to 34.3 billion won. In a report on the 11th, Kiwoom Securities announced that it has lowered Nexen Tire's target price from the previous 12,500 won to 10,500 won, while maintaining its investment rating at 'Buy'. Analyst Shin Yoon-cheol explained that the anti-dumping duties imposed by the European Union (EU) on Chinese tires were higher than expected, leading to changes in the business environment. Nexen Tire needs to secure new demand in markets outside the EU to maintain the operating rate of its Qingdao plant, and additional costs are expected to arise in this process. Currently, Nexen Tire's net debt is nearing 1.2 trillion won, and the corporate tax burden has also increased. Kiwoom Securities expects Nexen Tire's net profit this year to decrease compared to last year, and it assessed that using dividend resources for debt repayment to reduce interest costs could be favorable for boosting the stock price. Nexen Tire's performance in the second half of the year may vary depending on anti-dumping duties, raw material and shipping costs, and expenses for securing new demand.
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