[Click eStock] "Samyang Packaging's Q4 Earnings Expected to Increase Significantly"

[Asia Economy Reporter Eunmo Koo] Korea Investment & Securities forecasted a significant upward revision in Samyang Packaging's fourth-quarter earnings last year.

On the 21st, Do-yeon Lee, a researcher at Korea Investment & Securities, stated in a report that the estimated operating profit for Samyang Packaging in the fourth quarter of last year has been raised by 78% to 7.3 billion KRW, and this year's estimate has also been increased by 5%. Lee explained, "The reason for the substantial upward revision of the fourth-quarter earnings is that the forecasted aseptic sales volume, which accounts for nearly 70% of operating profit contribution, was raised by 12% compared to the previous estimate."

Lee added, "The fourth quarter is a seasonal off-peak period for the beverage market, and Samyang Packaging usually experiences about a 30% decrease in sales volume compared to the previous quarter due to scheduled maintenance. However, due to mild weather and tight supply, all four aseptic facilities, including new equipment, operated at nearly 100% capacity throughout October. Although scheduled maintenance was carried out as planned in November and December, strong demand continuing until the end of the year is estimated to have maintained a generally high operating rate despite the maintenance."

The investment opinion and target stock price were maintained at 'Buy' and 24,000 KRW, respectively. Lee explained, "From the first quarter of this year, performance is expected to improve significantly each quarter compared to the previous year. This is because the profit contribution from the new fourth aseptic facility, which started in the third quarter of last year, combined with the base effect from scheduled maintenance, is expected to improve operating profit by 21% compared to last year."

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