[Click eStock] "HiteJinro, Strong Performance Expected in the Second Half"

[Asia Economy Reporter Park Ji-hwan] IBK Investment & Securities maintained its 'Buy' rating and target price of 51,000 KRW for Hite Jinro, expecting a favorable performance trend in the second half of this year following the first half.

Kim Tae-hyun, a researcher at IBK Investment & Securities, said, "On a consolidated basis for Q2, sales and operating profit were 581.6 billion KRW and 54.1 billion KRW, up 10.9% and 410.9% year-on-year," adding, "despite an unfavorable business environment, strong sales of new products led to increased sales volumes of beer and soju, and a continued trend of market share expansion, resulting in excellent performance."

In the beer segment, it was analyzed that despite the sluggish market, Terra's sales volume recorded a soaring trend. Beer sales amounted to 214.6 billion KRW, up 12.6% year-on-year, and operating profit turned positive at 12 billion KRW. Although the beer market was sluggish due to the impact of COVID-19, the strong sales of Terra led to a noticeable improvement in performance. Terra's sales volume increased by about 200%, resulting in approximately a 20% increase in regular beer sales, while sparkling beer (Filite) and imported beer (distribution) decreased by 5% and 30%, respectively.

In the soju segment, sales and operating profit were 324.9 billion KRW and 38.5 billion KRW, respectively, representing increases of 11.6% and 43.3% year-on-year. Chamisul sales volume increased by 5%, and Jinro Is Back sales volume expanded significantly from 300,000 cases in Q2 last year to 3 million cases in Q2 this year.

Although competition in the beer market may intensify in the second half, the trend of performance improvement is expected to continue.

Researcher Kim Tae-hyun said, "Recently, competition in the beer market has intensified, so there is room for expanded marketing from a defensive sales perspective in the second half," adding, "however, the growth in soju performance and the profitability improvement trend in the beer segment due to strong Terra sales are expected to continue."

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