Hanssem, Expanding Interior Business...Expecting Performance Growth

[Asia Economy Reporter Park Jihwan] Mirae Asset Daewoo on the 1st presented a 'Buy' investment opinion and a target price of 77,700 KRW for Hanssem, stating that "the issue is growth, not normalization," and forecasted performance improvement this year due to the effect of expanded interior investment.

Researcher Lee Kwangsoo of Mirae Asset Daewoo stated, "Hanssem's 2020 performance is estimated at sales of 1.785 trillion KRW and operating profit of 104.2 billion KRW, a 96% increase compared to the previous year." Interior sales are increasing, and the number of Rehouse (remodeling) dealerships is increasing (from 80 at the beginning of 2019 to about 150 currently), which is evaluated as expanding market share.

Recently, Hanssem announced a goal to achieve sales of 10 trillion KRW within the next 7 years. To this end, it plans to actively expand the Rehouse business division. Of the 10 trillion KRW in sales, Rehouse sales are planned to be 5 trillion KRW.

Researcher Lee Kwangsoo said, "Basically, the interior industry is a B2C market, which can be significantly different from the kitchen business (B2B) that Hanssem has focused on," and evaluated, "The strategy to increase interior dealerships centered on Rehouse is excellent in terms of expanding the platform."

He said, "Performance deteriorated due to a decrease in apartment transactions and a contraction of the real estate market in 2018-2019," and predicted, "Performance is improving as housing transactions recovered in the 4th quarter of last year, and sensitivity to the real estate market will decrease in the future due to expanded investment in the interior business."

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