Nongshim Exceeds Q1 Earnings Expectations... Target Price Raised

[Asia Economy Reporter Oh Ju-yeon] Daishin Securities stated that Nongshim's first-quarter earnings this year significantly exceeded market consensus, and it is highly likely that strong performance will continue into the second quarter. Accordingly, they maintained a 'Buy' investment rating and raised the target price by 15% to 390,000 KRW.

On the 17th, Daishin Securities evaluated that Nongshim's consolidated sales for the first quarter reached 687.7 billion KRW, and operating profit was 63.6 billion KRW, greatly surpassing the previous Daishin Securities estimate of 36.4 billion KRW and the recently revised consensus operating profit of 44.1 billion KRW.

Domestic ramen sales increased by 18% compared to the same period last year, and market share improved significantly to 56.2%. Snack sales also rose by 14%, indicating continued strong sales performance.

In regions such as the Americas and China, ramen demand increased and supply expanded through online and large retail channels, resulting in sales growth of 23% and 29% respectively compared to the same period last year. Operating profit margins also improved significantly by 3.4 percentage points and 5.8 percentage points.

The second-quarter performance is also expected to be positive.

Researcher Han Yoo-jung said, "Although the large surprise in the first quarter may raise expectations for the second quarter somewhat high, there is a considerable base effect due to price competition in the second quarters of 2018 and 2019, and the increase in domestic and international dining demand seen in the first quarter is likely to continue into the second quarter."

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