Performance and Stock Price Both Soar... 'Smiling' Orion

June Consolidated Performance by Corporation: Sales of 157.3 Billion KRW, Operating Profit of 19.2 Billion KRW

Photo by Asia Economy DB

[Asia Economy Reporter Kum Boryeong] Orion is showing a cheerful situation as it has captured both performance and stock price.

According to the Financial Supervisory Service's electronic disclosure system on the 16th, Orion's consolidated corporate performance last month recorded sales of 157.3 billion KRW and operating profit of 19.2 billion KRW. Compared to the same period last year, these increased by 14% and 54%, respectively.

In particular, the strong performance of the China corporation continued. Despite being an off-season, the China corporation showed an operating profit of 8.1 billion KRW, growing 224% compared to the same period last year. Traditionally, June is an off-season in China because it is a period of inventory adjustment ahead of the summer peak season in July-August and the National Day peak season in September-October.

Lee Jeong-eun, a researcher at Korea Investment & Securities, said, "The sales of mid-70 billion KRW last month indicate an increase in market demand and market share," adding, "The third quarter is the first period when the peak season begins and competitors also shake off the effects of COVID-19, so whether Orion can maintain the market share gained during COVID-19 will be crucial."

Although there are concerns that competition will intensify from the third quarter, the securities industry views this as limited. Competitors who faced production and distribution disruptions in the first quarter increased promotional efforts from the second quarter, but due to the nature of the confectionery industry, once shelf space share is determined, it is difficult to change it in a short period. Orion is also aggressively launching new products to strengthen shelf dominance. Cho Sang-hoon, a researcher at Samsung Securities, explained, "Orion will continue efforts for sales growth through various methods such as partnership with Tao Kae Noi, strengthening new products, exporting rice snacks, and exporting Jeju Yongam water."

The stock price has risen higher than before COVID-19. Orion's stock price hovered around 80,000 KRW in July last year before the spread of COVID-19. However, this month it has been moving between 130,000 and 150,000 KRW. Comparing the closing price of 87,700 KRW on July 15 last year and the closing price of 135,000 KRW the previous day, it has risen by 53.93% in one year.

Lee Kyung-shin, a researcher at Hi Investment & Securities, said, "Not only the faster-than-expected recovery from COVID-19 but also growth beyond that is becoming visible, so despite the stock price rise, the valuation attractiveness due to increased operating performance is continuously highlighted," adding, "Considering the additional expectations for mid- to long-term strength improvement due to market position expansion in each region, simple comparison with previous stock price levels is meaningless."

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