[Click eStock] "'Strengthening Global Scalability' Samyang Foods, Target Price Maintained"

On the 26th, Kiwoom Securities maintained a buy rating and a target price of 270,000 KRW for Samyang Foods, stating that "global scalability will be strengthened through leveling up exports to the United States."

Samyang Foods announced on the 21st that its overseas sales exceeded 800 billion KRW for the first time last year, riding on the popularity of Buldak Bokkeum Myun. The photo shows an overseas promotion of the Buldak brand. [Image source=Yonhap News]

On the same day, Park Sang-jun, a researcher at Kiwoom Securities, said, "Leveraging the global scalability of the main brand, Buldak Bokkeummyeon, sales volume continues to show high growth. There is high visibility for a mid-term earnings rebound, and new client expansion centered on the U.S. market is ongoing."

First, with the completion of the restructuring of the Chinese online channel business, monthly exports to China are recovering. Overseas sales in the second quarter of this year have high visibility for growth, supported by the normalization of exports to China and pre-demand from shopping events. Researcher Park noted, "The profitability direction is also positive," adding, "Stabilization of raw material input costs is expected. In particular, marketing investments such as advertising expenses were expanded in the second half of last year, so the profitability base is relatively low, and there is a possibility that the operating profit margin could be raised one step depending on global sales performance."

In the mid-term, ahead of a production capacity expansion of more than 30% scheduled for May next year, the company is expected to focus on securing new clients in the U.S. market. Researcher Park explained, "Through sales performance at Costco and Walmart, the potential for expansion in the U.S. mainstream channels is being demonstrated. Marketing efforts on platforms such as YouTube and TikTok are underway to broaden the base of new consumers."

Furthermore, he added, "Especially, the recent increase in U.S. exports was achieved based on the relatively small Korean-American community market, so it is evaluated to have relatively high growth potential in the European market, which has a similar cultural background to the U.S. mainstream channels," and "Therefore, as regional scalability strengthens, there is a possibility that the total addressable market (TAM) of the main brand, Buldak Bokkeummyeon, will further expand."

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