[Click eStock] "Cosmax, Strong Technological Entry Barriers Maintained"

Hana Financial Investment Issues 'Buy' Rating and 100,000 KRW Target Price... Closing Price on 20th at 72,700 KRW

[Asia Economy Reporter Kum Boryeong] Cosmax's technological entry barriers remain intact.

According to Hana Financial Investment on the 21st, Cosmax's consolidated Q4 performance last year recorded an earnings surprise with sales of 353.1 billion KRW and operating profit of 16.9 billion KRW. These figures represent growth of 7% and 67% respectively compared to the previous year. Researcher Park Jongdae of Hana Financial Investment analyzed, "The technological entry barriers remained intact."

Domestic business sales increased by 9% year-on-year, driven by the effect of the top 5 brands centered around the Guanggunje event and new global exports. Operating profit grew significantly thanks to efficient cost management and productivity improvements. The China business also performed well. Sales of the Shanghai corporation normalized with a 1% decrease compared to the previous year, and the Guangzhou corporation showed an 88% growth rate.

Researcher Park said, "There are three meanings to be found in the Q4 performance last year. First, the normalization of the Shanghai corporation. Since Q1 last year, the sharp decline in the Shanghai corporation's performance had raised concerns about the erosion of Cosmax's technological entry barriers in China. The replacement of new buyers, which was expected to be completed by Q1 this year at the earliest, was completed early in Q4 last year, and the operating rate normalized, significantly alleviating such concerns. Second, the recovery of domestic business sales. Securing the top 5 customers with strong brand power in China has increased performance visibility. Third, there were no one-time costs domestically or internationally. Over the past year, Cosmax faced uncertainties such as increased bad debt and write-offs, and losses from inventory disposals. Throughout last year, conservative accounting and inventory management improved performance visibility," he explained.

Hana Financial Investment changed its existing investment opinion on Cosmax from 'Neutral' to 'Buy.' The target price was raised from 85,000 KRW to 100,000 KRW. The closing price on the 20th was 72,700 KRW.

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