LS SECURITIES analyzed on the 10th that Amorepacific Corporation's second-quarter performance will be at a level similar to market expectations (consensus). It also projected that performance growth will become prominent as product placements in major Western channels accelerate from the second half of the year. The target stock price was raised from the previous 150,000 won to 165,000 won, while the investment opinion was maintained as 'buy'.
Amorepacific Corporation's second-quarter revenue is expected to be 989.2 billion won, with an operating profit of 69.8 billion won. In the institutional sector of cosmetics, revenue of 438.9 billion won and an operating profit of 27 billion won are anticipated. Each figure represents an increase of 9% and 31.2%, respectively, compared to the same period last year. Performance in traditional distribution channels is expected to maintain similar figures during this period, while online sales and multi-brand shops are showing strong revenue growth.
By country, China is expected to see double-digit revenue growth due to the effects of business restructuring. The U.S. business is expected to grow by more than 10%, excluding COSRX, while the European business is projected to grow by over 20%. COSRX is expected to experience a revenue drop in the 20% range compared to the same period last year in the second quarter, but sales expansion is underway through price stabilization and new premium lines.
Orina, a researcher at LS SECURITIES, said, 'In the second half of this year, performance growth will be highlighted due to the rebound in duty-free shops, the turnaround in China, and sustained demand from Western countries,' noting that favorable business environments such as stimulus policies for domestic consumption and inflow of tourists in China are expected, as well as continued placements of proprietary brands in major Western channels.