Kosmekakorea Rose Against the Trend When KOSDAQ Index Fell

Up 260% Compared to Late Last Year... KOSDAQ Down 9.19%
Sales and Operating Profit Exceed Market Expectations... Growth Expected to Continue Next Year

Cosmeca Korea's stock price is trending upward, hitting a yearly high despite the sluggish KOSDAQ market. This appears to be influenced by expectations that the trend of improved earnings, with strong quarterly performances, will continue.

On the 23rd, Cosmeca Korea closed at 36,900 KRW, up 1,750 KRW (4.98%) from the previous trading day. This is the highest closing price of the year. It rose 35.16% compared to the previous month and surged 260% compared to the end of last year. This is a favorable return compared to the KOSDAQ index, which fell 9.19%, and the KOSDAQ chemical index, which dropped 7.70% from the end of last month.

Cosmeca Korea, established in October 1999, is a specialized company in cosmetics original design manufacturing (ODM) and original equipment manufacturing (OEM). One reason Cosmeca Korea is gaining attention is the boom of indie cosmetic brands. Indie brands, which started from fandoms based on social networking services (SNS), continue to gain popularity. Since many indie brands lack their own manufacturing facilities, companies like Cosmeca Korea can benefit.

Additionally, COVID-19 and China's reopening have acted as positive factors. In the first quarter of this year, Cosmeca Korea recorded sales of 115.9 billion KRW and operating profit of 9.3 billion KRW, increases of 30.27% and 1412.09% respectively compared to the same period last year. In the second quarter, sales were 115.7 billion KRW and operating profit was 11.2 billion KRW, up 15.18% and 264.72% year-on-year respectively.

Park Eun-jung, a researcher at Hana Securities, explained, "Operating profit in the second quarter surpassed 10 billion KRW, marking the highest quarterly profit ever," adding, "This is thanks to improved business conditions and corporate restructuring, including sales expansion, changes in client portfolio, product mix improvement, and efficiency enhancement of the Chinese subsidiary."

Strong performance is also expected to continue into the third quarter. NH Investment & Securities forecasts that Cosmeca Korea will record sales of 115.2 billion KRW and operating profit of 12.1 billion KRW in the third quarter. Kiwoom Securities expects sales of 118.3 billion KRW and operating profit of 11.6 billion KRW. These figures exceed market consensus estimates of 115.1 billion KRW in sales and 8.9 billion KRW in operating profit.

The securities industry expects Cosmeca Korea's growth to continue not only this year but also next year. Kiwoom Securities projects that next year, Cosmeca Korea's sales and operating profit will increase by 15% and 21% year-on-year to 536.8 billion KRW and 52.9 billion KRW respectively. Cho So-jung, a researcher at Kiwoom Securities, said, "The domestic subsidiary is expected to benefit from increased export volumes of small and medium-sized brands overseas," adding, "In the U.S., an increase in the proportion of high-margin products is anticipated, and in China, profits will improve significantly if order volumes increase."

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