[Click eStock] "Incross, All Negative Factors Reflected... Focus on Tidil Growth"

Shinhan Investment Corp. analyzed on the 24th that all negative factors regarding Incross have been reflected, and the high growth of the AI-based curation commerce platform 'T Deal' is noteworthy.

Incross recorded consolidated sales of 10.3 billion KRW and operating profit of 2.2 billion KRW in the first quarter of this year. This represents an increase of 10.2% and 21.1% respectively compared to the same period last year. However, the sales were 10.8% below consensus, and operating profit was 21.7% lower than expected.

Researcher Byunghwa Lee of Shinhan Investment Corp. stated, “Media lab handling volume recorded 73 billion KRW, which is lower than our estimate of 91.8 billion KRW,” and analyzed that “this is the result of the seasonal off-season combined with advertisers’ conservative advertising spending policies.”

Researcher Lee added, “The search advertising revenue of the subsidiary Mindknock is showing an increasing contribution, and T Deal recorded a total transaction amount of 52.7 billion KRW, an 85.6% increase compared to the same period last year, exceeding our estimate by 18.7%. Numerous planned exhibitions, enhanced price competitiveness, and the effect of TV advertisements contributed. 3.9% of T Deal’s transaction amount was recognized as sales.”

Last month, Incross experienced the CEO’s share sale and resignation, followed by the disclosure of poor first-quarter performance. Negative sentiment in the advertising market further dampened investor sentiment.

Accordingly, Researcher Lee said, “This is a period where materials for a turnaround in sentiment are more necessary than ever, and the rapidly growing total transaction amount of T Deal could be the starting point,” forecasting that “consolidated sales and operating profit for the second quarter will be 16 billion KRW and 6.1 billion KRW, respectively, representing increases of 27.2% and 26.6% compared to the same period last year.”

He added, “If T Deal’s sales contribution in the second quarter exceeds expectations, it will be possible to raise Incross’s performance estimates for the second half of the year and assign a growth premium to T Deal. Both Media Lab and T Deal still have many synergies expected with the SK Group, so it is time to wait for a stock price reversal after exposure to negative factors.”

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