[Click eStock] "GoYoung, Q1 Market Expectations Missed... Mobile Sector Growth Anticipated"

[Asia Economy Reporter Minji Lee] Hana Financial Investment stated on the 16th that Goyoung posted lower-than-expected results due to increased research and development expenses in the first quarter and sluggish performance in the automotive inspection equipment sector. However, they maintained a buy rating and a target price of 100,000 KRW, expecting improvement in the mobile sector's performance.

Goyoung recorded sales of 50.7 billion KRW in the first quarter, a 6% increase compared to the same period last year. Operating profit fell 16% to 5.6 billion KRW during the same period, falling short of the market expectation of 6.9 billion KRW.

Kim Kyungmin, a researcher at Hana Financial Investment, said, "Operating profit decreased more than the market expected due to increased research and development expenses," and added, "Sales appear to have met the expected 48.8 billion KRW."

By product and region, demand for 5G in the Greater China region contributed the most to first-quarter sales. Among product sales, mobile sales, which include 5G-related equipment, grew to 20.5 billion KRW, accounting for 40% of total sales. The sales proportion to China increased to 43%.

On the other hand, automotive inspection equipment underperformed. Demand and supply in the European automotive sector were significantly affected by COVID-19, resulting in automotive product sales accounting for only 14% of total sales.

Researcher Kim Kyungmin explained, "Among the main products, automotive industry clients postponed orders for assembly process product measurement appearance inspection machines (MOI) from the first quarter to the second quarter," adding, "This trend also affected sales by region, with sales to Europe accounting for only 10%."

Compared to sales in 2017?2018, the proportion of automotive sales dropped significantly from 30% to the 10% range. Meanwhile, the sales proportions of mobile and computer server products recorded 40% and 29%, respectively, indicating an increased IT share in the sales structure.

Researcher Kim Kyungmin emphasized, "After the outbreak of COVID-19, companies with a high proportion of mobile sales experienced significant stock price adjustments due to weakened smartphone demand," and added, "Following the easing of COVID-19, if suppressed demand is released as a reaction, Goyoung's sales are expected to improve rapidly."

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