[Click eStock] Hanwha "Hanssem, Only 1% Rise... Mid- to Long-Term Buying Strategy Valid"

[Asia Economy Reporter Ji Yeon-jin] Hanwha Investment & Securities announced on the 6th that it maintains a target price of 155,000 KRW for Hanssem, stating that a buying strategy from a mid- to long-term perspective is valid due to expected effects from new store openings in the second half of the year and recovery in special sales revenue next year.

Hanssem's consolidated sales for the second quarter of this year are expected to be 567.4 billion KRW, and operating profit is projected at 25.5 billion KRW, representing growth of 9.3% and 12.7% respectively compared to the same period last year. This operating profit forecast is 11.3% lower than the market consensus of 28.8 billion KRW. While B2B sales were sluggish due to a decrease in special sales revenue (down 26% year-on-year), B2C sales are expected to have recorded double-digit growth. Furniture sales growth has slowed, but the rehouse growth trend is expected to continue.

Despite anticipated cost burdens from steep increases in lumber prices, the impact on profit margins is expected to be limited due to furniture price increases in the second quarter and improvements in consolidated operating profit.

Growth centered on B2C is expected to continue in the second half of the year. A total of 10 rehouse standard stores are scheduled to open this year, but only one store was added by the end of May, with full-scale openings planned from June onward.

The number of rehouse construction personnel increased by about 700 from 2,459 at the end of last year to the end of May, and the number of package direct construction cases has steadily increased, contributing to an increase in the average selling price (ASP) of rehouse and margin improvement.

Song Yu-rim, a researcher at Hanwha Investment & Securities, explained, "B2B sales recovery is expected to accelerate next year, with the backlog of special sales furniture orders rapidly increasing since the fourth quarter of last year," adding, "The stock price of building materials, which is B2B-centered, rose in the first half of this year, but concerns about margin contraction due to raw material price burdens have resulted in the company's stock price return since the beginning of the year being only 0.9%."

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