[Click-e Stock] "Orion Posts Robust Global Sales as Cost Pressures Ease"

Shinhan Investment Corp. Raises Target Price

On March 18, Shinhan Investment Corp. maintained its 'Buy' investment rating on Orion and raised its target price by 14% to 160,000 won. This suggests an upside potential of about 24% compared to the current share price of 129,000 won. Shinhan Investment Corp. forecasted that easing cost burdens, along with a recovery in sales growth, will drive continued improvement in Orion's earnings.

The price of cocoa, a key ingredient in Orion products, has significantly declined this year. Screenshot from Shinhan Investment Corp. report

Shinhan Investment Corp. researcher Cho Sanghoon stated, "The price of cocoa, which exceeded $10,000 per ton last year, has recently dropped to $3,200, leading to a rapid reduction in cost pressures," and added, "From the first quarter of 2026, improvement in the margin spread (the difference between product price and cost) is expected to accelerate." He also assessed that, after two years of stagnation, Orion's top-line growth is highly likely to re-enter an upward phase beginning this year.

Orion is also expected to see a recovery in sales growth as it simultaneously pursues strategies to strengthen product competitiveness and expand its sales channels. By region, most overseas markets—excluding Korea—showed remarkable growth. As of February, year-on-year sales growth rates reached 16.5% in China, 25.8% in Vietnam, and 43.4% in Russia. Notably, sales in China during the Lunar New Year season rose by 8%, surpassing existing guidance.

The company’s valuation appeal has also become more prominent. The projected price-to-earnings ratio (PER) for 2026 is 10.7 times, which is at a discount compared to global industry peers. Shinhan Investment Corp. calculated its target price by applying a PER discounted by 20% from the global confectionery average.

Earnings estimates have also been revised upward. Projected 2026 sales are approximately 3.73 trillion won, and operating profit is expected to reach 660 billion won, marking upward revisions of about 5% and 9%, respectively, from previous forecasts. This reflects the impact of overseas business growth and cost stabilization.

Looking ahead, if regional diversification strategies—such as expansion into the Indian and U.S. subsidiaries and increased exports to the Middle East and Africa—are fully implemented, the company’s earnings growth could strengthen further. There is a strong likelihood that Orion’s share price will see a sustained mid- to long-term uptrend, driven by both cost reductions and overseas expansion.

Researcher Cho commented, "We are seeing both stable sales growth and easing cost pressures across all regions," and added, "If new product launches, channel expansion, and entry into new markets become more visible, further valuation gains are also possible."

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