2Q26 Earnings First Glance: Rotem (064350 KS), KIA (002700 KS), Samsung Heavy (010140 KS), Hyundai Mobis (012330 KS)

Research evidence excerpt

2Q26 Earnings First Glance: Rotem (064350 KS), KIA (002700 KS), Samsung Heavy (010140 KS), Hyundai Mobis (012330 KS)

Specialist Sales

APAC Specialist Sales J P M O R G A N

24 July 2026

2Q26 Earnings First Glance: Rotem (064350 KS), KIA (002700

KS), Samsung Heavy (010140 KS), Hyundai Mobis (012330 KS)

Joann Kim

+852 2800 8016

joann.kim@jpmorgan.com

*SPEC TAKES ONLY

Rotem (064350 KS): Miss on Lucrative EC1 Contribution Fade

• 2Q26 Results - Miss:Rotem reported 2Q26 revenue of W1,606bn, which came in -9%/-4% below JPMe/consensus, and

operating profit (OP) of W232.4bn, -29%/-18% below JPMe/cons. OPM was 14.5%, below JPMe of 18.5% and cons of

16.8% led by defense segment miss on lucrative EC 1 contribution fade.

• Defense Segment:Defense revenue was W918.9bn (-12% vs JPMe, -5% vs cons), with OP at W224.8bn (-28% vs JPMe, -

16% vs cons). Defense OPM was 24.5%, below JPMe of 30.0% and cons of 27.6%. The split between export and domestic

was 70:30, with domestic OPM at low single digits. Assuming a 2–3% domestic defense margin, export margin is estimated at

around ~34% (a QoQ decline from 35% in 1Q26).

• Key Takeaways From the Earnings Call: Co has guided for stable 2H revenue and profit stream with no clear updates on

Poland EC 3 timeline.

• JPM Valuation: Simon Han rates Rotem as OW with Jun-27 PT of W300K based on 23x 2027E P/E, a discount to global

peers due to thinner order pipeline, tougher battle tank competition, and its status as not a pure defense player. Simon Han’s

latest note here.

• Spec View & Feedback: Negative oon OP miss with QoQ export margin decline (though not as bad as feared, coming in at

35% vs below 30% of investors’ expectation) despite more working days and progress & F/X tailwind as lucrative EC1

contribution fades.