[Click eStock] BGF Retail, Convenience Store Performance Positive with Increased Outdoor Activities

[Asia Economy Reporter Hwang Yoon-joo] Ebest Investment & Securities maintained a 'Buy' rating and a target price of 206,000 KRW for BGF Retail on the 28th, stating that if the reopening accelerates this year, the company could benefit from the peak season effects in the 2nd and 3rd quarters.

Orin Ah, a researcher at Ebest Investment & Securities, said, "BGF Retail's net increase target for 2022 is 800 stores, and a profitability-focused store opening strategy will continue."

Researcher Oh noted, "The growth rates by product category in Q4 last year were 18% for HMR, 14% for beverages, 18% for snacks, and 15% for alcoholic beverages, showing generally favorable performance despite the spread of the Omicron variant," adding, "This strategy is expected to continue this year, and with increased outdoor activities, performance improvement is anticipated."

He assessed, "As sales tend to perform well with increased outdoor activities, price increases are planned for items such as alcoholic beverages, snacks, and beverages, which is expected to lead to an overall price rise that will positively impact convenience store performance."

He continued, "We believe that the company's position as a pure player in convenience stores, fully benefiting from the reopening-driven recovery in the convenience store industry, is a strength, and the differentiated product enhancement strategy implemented last year is also expected to continue to stand out this year."

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