Modetour Expects 'Performance Growth' with Recovery Outlook for Japan Routes

Southeast Asia Routes Also Showing Growth... Securities Firms Raise Target Prices

[Asia Economy Reporter Geum Bo-ryeong] With the normalization of Korea-Japan relations this year and the Tokyo Olympics scheduled for late July, the recovery of Japan routes is anticipated, leading to expectations of performance growth for Modetour.

According to Hyundai Motor Securities on the 12th, Modetour's fourth-quarter results last year are estimated at sales of 81.6 billion KRW and an operating loss of 2.3 billion KRW. The deficit is expected to continue following the third quarter.

Yoo Sung-man, a researcher at Hyundai Motor Securities, explained, "The sluggishness of the Japan route has persisted to date, with the Japan route in December last year recording an 84.8% decrease compared to the previous year. However, this year, with the Tokyo Olympics approaching at the end of July, a recovery trend in the Japan route is expected. The Saipan route, which was sluggish last year due to natural disasters such as typhoons, has also recovered, recently showing a strong recovery in the South Pacific route. Although the China route is sluggish due to the Hong Kong situation, the Southeast Asia route, which substitutes for it, is showing growth."

There is also analysis that Modetour will escape from deficits after the fourth quarter last year. Lee Hyo-jin, a researcher at Meritz Securities, said, "Modetour's reservation rate data, released along with the package outbound passengers in December, shows a better level compared to competitors. Although the boycott of Japan continues, it seems that some demand has been successfully absorbed by other regions such as Southeast Asia," adding, "Although a sacrifice in average selling price (ASP) seems inevitable, it is expected to succeed in breaking away from the deficit trend in the first quarter."

Accordingly, securities firms have raised their target stock prices for Modetour. Hyundai Motor Securities revised the target price from 15,000 KRW to 21,000 KRW, and Meritz Securities adjusted it from 18,500 KRW to 21,000 KRW.

This content was produced with the assistance of AI translation services.