[Click eStock] "LG Household & Health Care Continues Growth Trend in 2Q... Target Price Up"

[Asia Economy Reporter Song Hwajeong] NH Investment & Securities raised the target price of LG Household & Health Care from 2 million KRW to 2.1 million KRW on the 30th, expecting the growth trend to continue in the second quarter of this year. The investment opinion was maintained as 'Buy.'

NH Investment & Securities estimated LG Household & Health Care's consolidated sales for the second quarter at 2.1372 trillion KRW and operating profit at 360 billion KRW. These figures represent increases of 19.9% and 18.7%, respectively, compared to the same period last year. Sales and operating profit in the cosmetics segment are expected to increase by 33% and 30.3%, respectively. Researcher Jomijin from NH Investment & Securities explained, "Based on the high growth of 'Whoo' and the positive growth transition of 'Soohyang,' strong performance exceeding market growth rates is expected in the China local market (30%) and duty-free channel (93%). However, due to increased digital channel marketing expenses compared to before, the operating profit margin is estimated to decline slightly."

Sales and operating profit in the household goods segment are expected to increase by 6.8% and 2.3%, respectively, compared to the previous year. Researcher Jo said, "Although there is a burden from reduced sales of hygiene products, the inclusion effect of Physiogel and the expansion of premium brand sales will help maintain the growth in operating profit." Sales and operating profit in the beverage segment are estimated to increase by 4.5% and 2.1%, respectively, compared to the same period last year. The growth trend is expected to continue, supported by price increases and strong brand power. However, expanded marketing expenses during the peak season in the second quarter and can supply issues are expected to partially affect profitability improvement.

There is an opinion that a revaluation of corporate value based on performance trends is necessary. Researcher Jo stated, "Although 'Whoo' will continue its strong brand power and demonstrate demand for China once again, maintaining favorable performance, the growth rate compared to the previous year may appear somewhat lower since last year's performance was also good. However, in the current situation where revaluation of corporate value related to normalization is taking place across the industry, LG Household & Health Care's brand power and valuation attractiveness may also be highlighted."

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