[Click eStock] "Hyundai Home Shopping, Slightly Improved 3Q Performance... Structural Changes Needed"

Heungkuk Securities diagnosed on the 13th that although Hyundai Home Shopping's third-quarter performance showed some improvement amid continued poor results this year, a strategy is needed to overcome the structural growth limitations of home shopping. The investment opinion 'Buy' and the target price of 67,000 KRW were maintained.

On the day, Jongryul Park, a researcher at Heungkuk Securities, said, "Hyundai Home Shopping's third-quarter consolidated transaction volume (total transaction amount) is expected to record 1.2 trillion KRW, down 5.2% from the same period last year, with sales down 5.2% to 504.4 billion KRW, and operating profit up 3.5% to 31 billion KRW." Despite improvements in Hyundai L&C, the home shopping sector continued to show weakness.

Researcher Park said, "Compared to last year, the home shopping transaction volume is shrinking in size and profitability is weakening due to an increase in the proportion of travel products and a decrease in rental products," adding, "Efforts are underway to expand long-distance and premium products to improve the profitability of travel products. Depending on the outcome of retransmission fee negotiations with pay TV operators (SO), there is a possibility of profit and loss fluctuations."

He emphasized that urgent measures are needed to overcome the overall slump in the home shopping industry. Researcher Park analyzed, "In the fourth quarter, consolidated transaction volume is expected to be 1.2 trillion KRW, sales 495 billion KRW, and operating profit 17.8 billion KRW, which is worse than the same period last year," adding, "The TV viewing rate among the 20s and 30s age group is declining, revealing considerable limitations in the growth of the core TV business. A growth strategy should be pursued focusing on media that can connect with the MZ generation, such as mobile and data broadcasting."

He further stated, "Considering the reduction in TV sales proportion, smooth communication among industry players for a realistic retransmission fee system should also be considered," and added, "Improvement in performance momentum must be a prerequisite for a full-scale stock price revaluation."

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