[Click eStock] "Maeil Dairies, Brand Power Advantage... Earnings Expected to Rise"

[Asia Economy Reporter Park Jihwan] NH Investment & Securities on the 18th stated that Maeil Dairies shows superiority in product innovation and brand power, and expects the upward trend in performance to continue. They maintained a 'Buy' investment rating and a target price of 100,000 KRW.

Researcher Jomijin from NH Investment & Securities said, "Operating profit in the second quarter increased by 23% compared to the previous year," adding, "Although there may be short-term impacts due to the resurgence of COVID-19 and strengthened social distancing measures, the upward trend in performance is expected to continue based on brand power and product innovation." Despite worsening external variables such as declining birth rates and COVID-19 resurgence, it is explained that the company will maintain a stable upward performance trend based on strong brand power and corporate image compared to peers.

Above all, the continuous efforts to develop products and strengthen the brand in line with demographic changes and consumer trends have been highlighted as strengths, with innovative products being launched. In fact, Selex, grain milk, and Sangha Farm are driving sales growth and product mix improvement. Researcher Jomijin explained, "Adult nutritional food Selex is expected to sustain over 50% annual high growth through expansion of product lineup and sales channels."

In the second quarter, on a separate basis, sales amounted to 385 billion KRW and operating profit to 25.7 billion KRW, representing an 8.5% and 22.5% increase compared to the previous year. Recovery in sales through convenience store channels, which had a high proportion in the previous year affected by COVID-19, and online growth were observed. Operating profit margin improved by 0.8 percentage points over the year due to product mix improvement, concentrated marketing expenses in the previous quarter, and the reflection of results from proactive investments made before the peak season.

Researcher Cho stated, "Although the decline in formula milk sales due to the decrease in birth rates is a burden, Sangha Farm has recovered double-digit growth rates, and the strong sales trend of grain milk and cheese, which have emerged as new high-margin items, continues."

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