[Click eStock] "Nongshim, Domestic and Overseas Ramen Sales Increase... Strong Performance in Q2"

Hana Financial Investment Issues 'Buy' Rating and 430,000 KRW Target Price... Closing Price on 10th at 323,000 KRW

[Asia Economy Reporter Kum Boryeong] There is a forecast that Nongshim's performance will exceed market expectations in the second quarter as well as in the first quarter.

According to Hana Financial Investment on the 11th, Nongshim's consolidated sales for the second quarter are estimated at 648.7 billion KRW, and operating profit at 40.4 billion KRW. Compared to the previous year, sales are expected to increase by 14.2%, and operating profit by 392.4%.

One of the biggest reasons for the expected strong performance in the second quarter is that domestic and overseas ramen sales remain strong. Sim Eunju, a researcher at Hana Financial Investment, explained, "Total domestic ramen sales are expected to increase by 11.5% compared to the previous year. Domestic ramen market share (by value) is projected to rise by 1.3 percentage points to 55%. Domestic ramen sales are estimated to increase by 7.5%, and exports by 40% compared to last year. With the easing of competition, domestic operating profit will increase significantly compared to the previous year. Overseas subsidiary sales growth is expected to surpass that of the first quarter."

This strong performance is not attributed solely to the novel coronavirus disease (COVID-19). Researcher Sim said, "This is because the fatigue from new products and the easing of cutthroat competition in the domestic ramen market, which began even before COVID-19, have become visible. The advertising effect through various channels such as YouTube, moving away from traditional media advertising, is also judged to have a positive impact on sales growth. Above all, it is necessary to pay attention to the fact that the export capacity of Korean processed foods, centered on ramen, is leveling up due to changes in perception of Asian Americans."

Hana Financial Investment gave Nongshim a 'Buy' investment rating with a target price of 430,000 KRW. The closing price on the 10th was 323,000 KRW.

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