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Photo = Yonhap news |
[Alpha Biz= Paul Lee] On May 7, Yuanta Securities analyzed that Amorepacific continues to show high growth in its core overseas markets and raised its target price from 160,000 KRW to 178,000 KRW while maintaining its "Buy" rating.
Lee Seung-eun, a researcher at Yuanta Securities, stated, "Amorepacific maintains continuous high growth and solid profitability in key overseas markets, such as North America, EMEA (Europe, Middle East, and Africa), and Japan." He added, "Given the visible results of the company's portfolio rebalancing strategy, we have revised the target price upwards."
The researcher also noted, "Amorepacific's North American sales for the first quarter increased by 79% year-on-year to 157.2 billion KRW, with a 30% growth excluding the COSRX brand, and it maintained a double-digit operating profit margin."
He further explained, "EMEA saw a 219% increase to 55.3 billion KRW, and Japan grew by more than 70%." Regarding China, he mentioned, "China saw a 10% decline but turned profitable for the first time in eight quarters, and the company plans to maintain a profit margin of 3-5% going forward while continuing lightweight operations and digital transformation centered around Sulwhasoo."
Looking ahead, Lee pointed out, "The second quarter is typically a seasonally weaker period for consolidated revenue compared to the first quarter, and an increase in costs due to June incentives is expected." However, he emphasized, "Amorepacific plans to balance profitability and growth through overseas portfolio rebalancing, maintaining profitability in China, and the growth of major brands."
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
