[Click e-Stock] "Shinsegae Department Store Grows by 20%... Strong Luxury and Fashion Recovery"

On April 14, LS Securities maintained its target price for Shinsegae at 420,000 won and its "Buy" investment rating, reflecting expectations for the company’s performance.

Orina Oh, a researcher at LS Securities, stated in a report released that day, “Department store sales based on management standards are expected to grow by about 20% year-on-year in the first quarter of this year. All categories are showing solid growth, with continued strong performance in luxury goods and a recovery in fashion expected to play a significant role.”

Shinsegae’s consolidated sales for the first quarter of this year are estimated at 1.7956 trillion won, up 7.8% year-on-year, with operating profit forecast at 180.1 billion won, a 36.1% increase. Department store operating profit is expected to rise 23.9% year-on-year, driven by asset effects among domestic customers and robust sales to foreign customers. The Shinsegae DF (duty free) division’s average daily sales for the first quarter are estimated at around 9.1 billion won, with operating profit expected to reach approximately 1.7 billion won due to stabilized commission rates. Shinsegae International is believed to have passed through its most challenging period, and both Central City and Shinsegae Casa are expected to post stable results.

Researcher Oh commented, “In the Korean department store industry, the proportion of sales to foreign customers remains in the mid-to-high single digits compared to peak levels. Considering the increase in the number of foreign tourists and the diversification of consumption channels, the proportion of foreign customer sales is highly likely to rise, which could lead to improved same-store growth rates and entry into a profitability leverage phase. Last year’s flagship store renewal is expected to further maximize this effect.”

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