[Click eStock] "Cosmax, Strong Performance Despite Weakness in China... Target Price Up"

On the 20th, Samsung Securities raised the target price for Cosmax from 113,000 KRW to 133,000 KRW.

Cosmax is estimated to have recorded sales of 464.2 billion KRW in the second quarter of this year, a 15% increase compared to the same period last year. Operating profit for the same period is expected to reach 37.9 billion KRW, a 120% increase. Although the performance of the Chinese subsidiary was sluggish as expected, sales of the Korean subsidiary grew significantly due to increased export demand. Sales in the US, Indonesia, and Thailand also grew substantially, leading to evaluations that Korea’s Original Design Manufacturing (ODM) business model is redefining the global cosmetics industry.

Not only Cosmax but also other domestic ODM companies have commonly recorded rapid sales growth this year. This is thanks to increased demand for global small and medium-sized brands and indie brands. With the rise of e-commerce and multi-brand shop channels lowering the entry barriers for new brands, and consumers’ purchasing power shrinking, rational consumption appears to be becoming the mainstream trend.

Park Eun-kyung, a researcher at Samsung Securities, said, "When new brands emerge rapidly, it is the best time for ODM companies to operate," adding, "For Korean ODM companies that have grown within Korea’s unique cosmetics industry structure, where manufacturing and marketing have long been divided, a great opportunity has opened." She continued, "As global consumers increasingly accept new brands at reasonable prices, Korean small and medium-sized brand companies are accelerating their overseas market penetration," and added, "Korean ODM companies are infiltrating global consumers’ pouches through various channels even before they fully recognize them, with Cosmax at the forefront."

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