[Click eStock] Kolon Industries, Raw Material and Freight Cost Increase... Target Price Down

[Asia Economy Reporter Hwang Yoon-joo] On the 28th, KB Securities maintained its 'Buy' rating on Kolon Industries, reflecting the rise in raw material and freight costs due to inflation, but lowered the target price to 97,000 KRW.

Baek Young-chan, a researcher at KB Securities, stated, "The first quarter revenue is expected to increase by 10.9% year-on-year to 1.2098 trillion KRW, but operating profit is forecasted to decrease by 8.6% to 63.2 billion KRW."

Researcher Baek explained, "Although revenue increases due to higher selling prices, profit is expected to slightly decline compared to the previous year due to continued freight cost burdens."

He evaluated that while the first quarter performance improvement is limited, quarterly profit growth is expected thereafter, so there is no need for disappointment.

Researcher Baek analyzed, "Although there may be fluctuations due to offsetting freight cost burdens through gradual selling price increases, resolution of supply chain issues in the second half following the easing of the pandemic, and the commencement of commercial production of Vietnam PET tire cords in the second half, the overall direction remains positive."

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