Hyundai's shares experienced a significant increase on Thursday as Chief Executive Chung Ki-sun prepared to discuss potential business collaborations with the head of Saudi Arabia's top oil company and sovereign wealth fund during their visit to Seoul.
The South Korean holding company, known for its shipbuilding, construction-equipment, and oil-refining affiliates, saw its shares rise by 5.5% to close at 63,700 won ($47.73), marking its largest daily percentage gain in over two years, according to FactSet data. In contrast, the stock benchmark Kospi fell by 0.6% on the same day.
The surge in HD Hyundai shares reflects the growing market optimism surrounding the conglomerate's expansion plans in Saudi Arabia, particularly after the visit of Yasir Al-Rumayyan, a prominent businessman and close aide to Crown Prince Mohammed bin Salman. Al-Rumayyan, the chairman of Saudi Arabian Oil and governor of the Public Investment Fund, is currently on a trip to South Korea from September 6th to 8th, engaging in talks with Korean government officials and business leaders, including HD Hyundai's CEO in Seoul on Friday. Multiple local media reports have confirmed these discussions.
HD Hyundai has already established a shipyard in Saudi Arabia in 2017 and an engine company in 2020. Furthermore, HD Hyundai Construction Equipment recently secured a deal to supply excavators and other construction equipment for the Neom megacity project in the kingdom.
In 2019, Aramco, Saudi Arabia's national oil company, invested $1.2 billion in HD Hyundai Oilbank, consequently becoming the refinery's second-largest shareholder. This investment serves as a testament to the strong affiliation between Aramco and the Korean conglomerate.
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