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Photo = Shinsegae Group |
[Alpha Biz= Reporter Kim Sangjin] Yuanta Securities commented on Shinsegae's disappointing Q3 results and forecasted that the challenging business environment will continue into Q4. They maintained a "Buy" rating on the stock but lowered the target price from 220,000 won to 170,000 won.
Yuanta's analyst stated that Shinsegae's consolidated Q3 revenue amounted to 1.5401 trillion won, with operating profit of 93 billion won, which fell short of market expectations of 118.3 billion won.
For the department store segment, sales totaled 1.6877 trillion won, with operating profit of 88.3 billion won, as major stores experienced steady growth. However, Shinsegae DF posted an operating loss of 16.2 billion won, partly due to increased rent from the opening of new stores at Incheon Airport's Terminal 2.
Yuanta Securities expects that the challenging business conditions will continue into Q4, citing high interest rates and exchange rates as ongoing hurdles. The analyst noted that Shinsegae will focus on cost-cutting measures, such as reducing promotional and labor costs, in an effort to improve profitability.
Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)
