[Click eStock] "Seegene, Growth in Non-Corona Products Also Expected"… Upgraded to 'Strong Buy'

[Asia Economy Reporter Lee Jung-yoon] On the 18th, KTB Investment & Securities upgraded its investment opinion on Seegene from Buy to Strong Buy, anticipating an increase in demand for diagnostic kits due to the resurgence of COVID-19 and a rise in sales of non-COVID products. However, due to the inevitable revenue decline this year as the COVID-19 pandemic eases, the target stock price was maintained at 80,000 KRW.

Seegene recorded sales of 410 billion KRW and an operating profit of 199.9 billion KRW in the fourth quarter of last year. It is evaluated that sales of COVID-19 diagnostic kits significantly exceeded estimates due to the global spread of the Omicron variant at the end of last year. Lee Ji-soo, a researcher at KTB Investment & Securities, said, "Following the fourth quarter of last year, growth in COVID-19 diagnostic kit sales is expected in the first quarter of this year as well," adding, "With the global resurgence of COVID-19, demand is increasing not only domestically but also in Europe and Latin American countries, and sales of non-COVID products are expected to rise due to new customer acquisition, leading us to revise upward the annual performance estimates for this year."

Although Seegene's selling and administrative expenses increased due to workforce expansion and incentive payments, it is analyzed that the company achieved an operating profit margin (OPM) of 48.8% thanks to increased sales of highly profitable syndromic diagnostic products and variant diagnostic kits. Syndromic diagnostic products refer to symptom-based diagnostic products that test for pathogens causing similar symptoms all at once.

The researcher added, "The launch of Fast PCR products, which can deliver results within 30 minutes to 1 hour with accuracy similar to conventional PCR (polymerase chain reaction), is expected to replace the demand for rapid diagnostic kits," and "It is anticipated that these products can be utilized in mobile stations for on-site testing at multi-use facilities such as concerts, schools, and airports."

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