[Click eStock] "Global Tax Free, Turning COVID-19 into an Investment Opportunity"

[Asia Economy Reporter Hyunseok Yoo] KB Securities analyzed on the 26th that although the performance deterioration of Global Tax Free due to the novel coronavirus infection (COVID-19) is inevitable, it is also possible to consider a contrarian investment strategy that views crisis as opportunity.

Researcher Byunghwa Lee of KB Securities said, "A decrease in inbound tourists is inevitable due to the uncertainty of COVID-19," adding, "The stock price recorded a -34.6% drop from the January peak to the February low. While performance deterioration is unavoidable, excessive concerns have also been reflected in the stock price in a short period." He continued, "As long as COVID-19 is not over, improvement in investment sentiment will inevitably be limited, but at this point, it is worth considering a contrarian investment strategy that sees crisis as opportunity."

He explained, "The monthly sales of 500 million KRW recorded in July 2015, the worst phase during the MERS outbreak, can serve as a benchmark for contrarian investment," and added, "Despite the recent spread of COVID-19, the sales decline is not significant compared to the MERS period." He further explained, "Unlike MERS, the epicenter of COVID-19 is China, which may have a lower direct impact on domestic inbound tourism. Also, the structural improvement of the inbound industry, such as the expansion of individual tourists and non-Chinese tourists compared to existing Chinese group tourists, is believed to be reflected in the tax refund performance."

Researcher Lee emphasized, "Although the timing of recovery after the crisis cannot be predicted, the growth of the inbound tourism market, the market dominance of the number one tax refund operator, favorable policy changes such as the immediate refund limit expansion in April, and fundamental competitiveness and favorable industry developments remain valid," adding, "The period in which direct benefits from COVID-19 can be confirmed in performance has only been delayed."

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