[Click eStock] "Silicon2, Benefiting from Global Spread of K-Beauty... Target Price Set at 49,000 Won"

Hana Securities analyzed on the 29th that Silicon2 is expected to benefit from the global spread of K-Beauty. They newly issued a 'Buy' investment rating and a target price of 49,000 KRW.

Silicon2 is an export company that sells over 10,000 SKUs (Stock Keeping Units) from about 400 cosmetic brands to more than 160 countries worldwide through its own platform via e-commerce direct overseas sales and to corporate clients.

Park Eun-jung, a researcher at Hana Securities, explained, "Silicon2 is experiencing high growth driven by global K-Beauty demand. Korean cosmetics exports grew at an average annual rate of +8% from 2019 to 2023, but Silicon2, whose sales mostly consist of exports, recorded a stronger average annual sales growth rate of +52% during the same period." She added, "Thanks to the expanding demand, Silicon2's contribution to Korea's total exports is continuously increasing."

She said, "Silicon2 has established branches in major global hubs and built a system capable of handling large volumes locally through expanded sales networks. This has enabled them to sufficiently process large shipments sent to local markets." She continued, "With investments extending to local logistics warehouses, the structure is moving towards increased processing volume and logistics cost efficiency."

She noted, "Last year, a 9-second slick-back dance TikTok video went viral worldwide, reaching 200 million views in just three days, becoming a global sensation." She explained, "The power of media dissemination is faster and stronger than ever, and at the same time, market trends are rapidly changing."

Researcher Park analyzed, "In this environment, it is efficient for brand companies to focus on branding, while distribution is entrusted to distributors who secure domestic and international retailers and possess logistics infrastructure." She added, "This can optimize the costs spent on overseas expansion, customs clearance, logistics, and the time required to secure sales networks." She emphasized, "In such an environment, Silicon2 will secure hegemony."

Hana Securities forecasted that Silicon2's sales and operating profit will reach 650 billion KRW and 120 billion KRW this year, respectively, representing increases of 90% and 150% compared to the previous year. She emphasized, "We expect high growth again this year, driven by the global expansion of K-Beauty demand and the resulting increase in suppliers. The main growth regions this year are the United States, the Netherlands (Europe), and Southeast Asia, with demand growth also expected in other regions including the Middle East and South America."

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