[Click eStock] "Hanjin, Earnings Below Expectations Due to Coupang Delivery Decline"... Target Price 40,000 Won

[Asia Economy Reporter Ji Yeon-jin] Daishin Securities announced on the 20th that Hanjin's second-quarter earnings fell short of market expectations due to a decrease in Coupang's courier volume, lowering the target stock price by 11% to 40,000 KRW. However, the buy rating was maintained.

Coupang's provisional second-quarter results recorded sales of 706.8 billion KRW and operating profit of 29.8 billion KRW. It is estimated that the operating profit margin declined due to a decrease in volume in the courier business division. The courier volume was 44 million boxes in April, 45 million in May, and 410 million in June, with a total second-quarter courier volume of 1.31 billion boxes, a 6.5% increase compared to the previous year. However, the volume growth significantly slowed compared to the first quarter's 1.34 billion boxes.

Yang Ji-hwan, a researcher at Daishin Securities, stated, "The courier volume in June, when the impact of Coupang's volume decrease fully appeared, declined compared to the same month last year, suggesting a deterioration in the profitability of the courier division. In 2021, Hanjin handled an average of about 5.5 to 5.7 million boxes per month for Coupang, but a decrease of 1.9 to 2.0 million boxes per month is expected in the second half of this year."

Considering the time required to replace Coupang's volume with other clients' volumes and the incentives needed to attract volume, it is expected that it will take time for courier profitability to recover.

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