[Click eStock] "Lotte Chilsung, Target Price Raised Amid Highlighted Real Estate Value"

DB Financial Investment Issues 'Buy' Rating and Target Price of 147,000 Won... Closing Price on 15th at 109,500 Won

Chilsung Cider by Lotte Chilsung Beverage (Photo by Asia Economy DB)

[Asia Economy Reporter Kum Boryeong] As the real estate value held by Lotte Chilsung has come into the spotlight, on the 16th, DB Financial Investment gave Lotte Chilsung a 'Buy' rating with a target price of 147,000 KRW. The target price was raised by more than 17% from the previous 125,000 KRW. The closing price on the 15th was 109,500 KRW.

According to DB Financial Investment, Lotte Chilsung's land in Seocho-dong, Seocho-gu, Seoul is attracting attention. This is because the area of the Seocho-dong land used by Lotte Chilsung as a logistics warehouse is 42,312㎡, which is twice the size of the nearby Samsung Town (24,000㎡), in the Seocho-dong area where Seoul City and Seocho-gu are preparing a district unit plan revision.

Researcher Cha Jaehun of DB Financial Investment said, "Although development discussions began in the early 2000s, there were many restrictions as it was designated as an apartment district, and there were significant disagreements with Seoul City regarding the public contribution ratio and other factors. Lotte Group applied for preliminary negotiations with Seoul City in 2009 and submitted plans twice in 2010 and 2015, but they were not accepted," adding, "Urban planning experts expect that the stalled development discussions will gain momentum with the preparation of this revision plan. Seoul City also sees that the major obstacle in negotiations has been resolved with the establishment of the district unit plan, and the scope of discussions has considerably expanded. It is also expected that the time required for preliminary negotiations, where Seoul City and landowners negotiate floor area ratio, donation ratio, etc., will be shortened."

The area is increasingly likely to change from a general residential zone to a commercial zone. Researcher Cha explained, "Lotte Group had planned to build the Second Lotte Town, a complex with lodging, commercial, and office functions, 47 floors high, and it is estimated that this plan will be re-pursued."

The real estate valuation reflected in the calculation of this target price is 725 billion KRW, but it may vary depending on floor area ratio, donation ratio, development methods, and other factors.

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