[Click eStock] "Golfzon, Earnings Estimate Downgrade"... Target Price ↓

NH Investment & Securities lowered the target price for Golfzon from 180,000 KRW to 160,000 KRW on the 18th due to a downward revision of profit estimates reflecting the promotion of new product launches in the third quarter of this year. However, the buy rating was maintained.

Golfzon's sales in the second quarter of this year are expected to reach 169.7 billion KRW, a 16% increase compared to the same period last year, while operating profit is expected to decline by 11.9% to 40.2 billion KRW, falling short of previous estimates. This is due to poor performance of subsidiaries such as Golfzon Deca and increased costs from investments in the United States.

Golfzon started its franchise business in 2016 with the launch of ToVision. The newly released ToVision NX is a full version product launched seven years after ToVision, featuring significant improvements in graphics by utilizing the Unreal Engine and changes in the projector.

Jun-ki Baek, a researcher at NH Investment & Securities, explained, "The key feature is maximizing the utilization of the Motion Plate launched in the third quarter of last year to enhance realism." He added, "Although the recent decline in profit margins is regrettable, considering the significant slowdown in the golf industry this year, Golfzon's annual sales growth and expected operating profit exceeding 140 billion KRW are considered to be better than just holding steady."

He continued, "Moreover, the new product launch is expected to stimulate conversion demand from the approximately 4,000 Vision franchise stores, so profit margins are expected to rebound again next year," and "Based on monthly export data, the export ratio in the third quarter is expected to increase significantly."

Researcher Baek also noted, "In addition to the U.S. and China markets, which are attracting attention in the market, high growth in the Japanese market is also expected." He added, "Golfzon is currently achieving high growth rates mainly through GDR sales, and there is potential for entry into the GS (game simulator) business, so future expectations remain valid."

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