[Click eStock] "Youngone Holdings, Upward Trend Expected"... Coverage Initiated

[Asia Economy Reporter Lee Jung-yoon] Hyundai Motor Securities announced on the 27th that it is initiating coverage on Youngone Holdings with a buy rating and a target price of 80,000 KRW.

Youngone Holdings' business segments consist of Youngone Trading and Youngone Outdoor. Youngone Trading operates woven apparel OEM (Original Equipment Manufacturer) and the bicycle brand Scott, while Youngone Outdoor manages the domestic North Face brand business.

For the first quarter of this year, Youngone Holdings reported consolidated sales of 890.2 billion KRW, a 38.3% increase year-on-year, and operating profit of 180.9 billion KRW, up 93.8%. Youngone Trading's OEM sales grew more than 50% compared to the same period last year, and Youngone Outdoor's sales also increased by 59.1%, achieving the highest first-quarter performance ever. Furthermore, sales for the second quarter are expected to rise 20.4% year-on-year to 905.3 billion KRW, with operating profit increasing 37.9% to 160.7 billion KRW, continuing the strong performance trend.

Jeong Hye-jin, a researcher at Hyundai Motor Securities, explained, "In the case of Youngone Trading, the improvement in OEM and Scott business segment performance has significantly enhanced the company's overall OPM (Operating Profit Margin) from 10% before the COVID-19 pandemic to around 16%. Youngone Outdoor has strengths in winter apparel categories, and sales in the spring and autumn clothing categories are gradually expanding, which is expected to progressively mitigate the off-season effects."

She added, "The improved profit structure during the pandemic period has yet to be fully reflected in the stock price," and "a gradual upward trend in the stock price is expected as it remains in an undervalued range."

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