[Click eStock] "Emart Expanding Leadership in Food Online Market... Target Price Up 19%"

[Asia Economy Reporter Park Jihwan] Hana Financial Investment maintained a 'Buy' rating on Emart on the 10th, stating that it is expanding its dominance in the online food market, and raised the target price by 18.52% from the previous 135,000 KRW to 160,000 KRW.

Park Jongdae, a researcher at Hana Financial Investment, said, "Emart has proven its superiority in online food distribution capabilities due to the novel coronavirus disease (COVID-19)," and evaluated that "Emart is expanding its dominance as the number one company in the online food market by fully operating the Gimpo Neo Center No. 3 in February and expanding the PP Center."

In particular, it is analyzed that Emart's food category distribution capabilities have become more prominent due to the spread of COVID-19. The increase in confirmed COVID-19 cases among competitors' logistics center workers since mid-May demonstrated the superiority of Emart's automated logistics system.

Researcher Park explained, "Frequent stockouts by other competitors confirmed Emart's superiority in sourcing ability, inventory management, and production capacity (CAPA) during periods of unstable fresh food harvests."

He added, "After the third quarter, the possibility of turning to profit growth is increasing due to the low base of the previous year and the high growth and profitability improvement of key new businesses such as SSG.com, specialty stores, and Traders," and analyzed, "The existing store growth rate of Emart discount stores in August is expected to be minus (-) 2.5%, which is not a large decline compared to expectations."

Researcher Park said, "Considering the impact of the Chuseok holiday period, it is reasonable to view the actual growth as above 0%," and added, "This is attributed to the significant increase in PP Center sales as online sales expanded due to the resurgence of COVID-19."

As the largest hypermarket operator in Korea, Emart is solidifying its position as number one in the domestic food online market, which has the greatest growth potential in the online distribution market, based on its powerful sourcing, storage, and delivery infrastructure. Furthermore, it is leading all major domestic businesses in PB (No Brand), warehouse-style hypermarket (Traders), and food online (SSG.com), which are considered global distribution trends.

He stated, "If profit growth becomes visible after the third quarter, Emart is expected to be re-evaluated as the Walmart of Korea, leading to strong stock price momentum."

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