LG Household & Health Care Strengthens Brand Power with Physiogel Acquisition... "Maintaining Stable Growth Stock"

[Asia Economy Reporter Kum Boryeong] LG Household & Health Care is maintaining its status as a 'stable growth stock' by securing brand capabilities through the acquisition of Physiogel.

According to DB Financial Investment on the 22nd, LG Household & Health Care is acquiring the Asian and North American business rights of the Physiogel brand from GSK for approximately 190 billion KRW.

Physiogel is relatively well-known in Korea. Its global sales are estimated to be around 110 billion KRW, with Asia accounting for 60% of that. In particular, sales in Korea are analyzed to make up 34%.

It is expected that business synergy will occur by acquiring a brand with high royalty. Hyunjin Park, a researcher at DB Financial Investment, said, "Compared to numerous past mergers and acquisitions (M&A), this is a relatively large-scale investment, and considering Physiogel's brand capabilities, significant synergy with the company is expected. Physiogel, which has become famous through word of mouth for its excellent efficacy on sensitive and atopic skin, has high brand loyalty, with some of its main products holding top market shares in the domestic skin and emulsion categories. Domestically, it is handled through online, H&B channels, and large supermarkets, and marketing is expected to expand through LG Household & Health Care's distribution network in the future," he explained.

Although Physiogel does not currently operate in the North American market, it plans to enter through LG Household & Health Care's subsidiaries in the United States and Canada. Production and expansion are also expected to take place through local subsidiaries in Japan and China.

Researcher Park expressed a continued preference for LG Household & Health Care as a 'stable growth stock.' He said, "Looking at recent M&A cases, it is clear that the company's needs for brands with high capabilities and potential, as well as distribution networks, are reflected. Among numerous M&A deals, this acquisition of Physiogel is expected to meaningfully contribute to enhancing the company's capabilities and loyalty, making it positive. The performance improvement effect through M&A will be reflected later, so there is a high possibility of raising the target stock price. We will continue to present a favorable view of LG Household & Health Care, which maintains its attractiveness as a stable growth stock," he stated.

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