[Click eStock] "Shinsegae, Growth Slows... Target Price Down"

On the 28th, KB Securities lowered the target price for Shinsegae from 340,000 KRW to 310,000 KRW.

Shinsegae recorded total sales of 3.526 trillion KRW and an operating profit of 141.3 billion KRW in the fourth quarter of last year. Compared to the same period last year, sales increased by 12%, but operating profit decreased by 28%. In the department store sector, the growth momentum somewhat slowed compared to the previous seven consecutive quarters of double-digit growth. This is attributed to sluggish clothing sales due to higher-than-average temperatures.

The duty-free store posted an operating loss of 26.3 billion KRW, falling short of expectations. The operating profit was negatively impacted by approximately 15 billion KRW due to a sharp appreciation of the dollar, in addition to 23 billion KRW in amortization of airport store usage rights and 16 billion KRW in city store license fees. Casamia also recorded an operating loss of 17.8 billion KRW, with profitability deteriorating due to rising raw material prices and logistics costs.

Shinsegae's total sales for this year are projected to increase by 5% from last year to 13.5 trillion KRW, and operating profit is expected to rise by 13% to approximately 728.5 billion KRW.

Park Shinae, a researcher at KB Securities, said, "Considering the downside resilience based on the department store's strong profit-generating ability and expectations for improvement in duty-free store profitability, a buy approach is valid."

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