[Click eStock] "CJ Daehan Tongun, Expecting Momentum for Parcel Price Increase Next Year"

[Asia Economy Reporter Eunmo Koo] Eugene Investment & Securities forecasted that the parcel delivery price increase next year could become a growth driver for CJ Logistics.

Eugene Investment & Securities estimated that CJ Logistics' consolidated sales for the fourth quarter of this year will reach 3 trillion KRW, a 6.0% increase compared to the same period last year, while operating profit is expected to decrease by 2.9% to 98.4 billion KRW. Minjin Bang, a researcher at Eugene Investment & Securities, explained in a report on the 18th, "The volume of goods is expected to maintain a solid growth rate of about 25% compared to the same period last year, and the average unit price is expected to decline by about 2% due to mix effects," adding, "The trunk line cost issue, which had impacted parcel margin rates in the previous quarter, appears to have stabilized." Furthermore, he said, "The global segment is also expected to continue its recovery," noting, "There is room for further improvement in overseas subsidiaries that have already turned profitable in the previous quarter, and an increase in forwarding volume is anticipated due to the recent surge in air freight rates."

The investment opinion and target stock price were maintained at 'Buy' and 210,000 KRW, respectively. Researcher Bang stated, "CJ Logistics' parcel delivery business this year is expected to see profits soar by more than 70% compared to last year due to an unexpected increase in volume caused by COVID-19 and improved operational efficiency," adding, "Although the base has risen, growth in volume is expected to remain valid next year due to changes in consumption patterns, and if the parcel delivery price increase succeeds, another profit momentum is anticipated."

He also noted, "A social consensus has been formed that a price increase is inevitable to raise fees for improving parcel delivery workers' treatment," and "In the mid to long term, stable growth in the parcel delivery sector is expected as captive last-mile volume is likely to progress with the expansion of the e-fulfillment business with Naver."

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