[Click e-Stock] "Second Quarter Results Expected to Impress... Kolmar Korea Target Price Raised"

Meritz Securities has raised its target price for Kolmar Korea from 90,000 won to 104,000 won. The investment opinion remains a buy.

On the 22nd, Meritz Securities analysts Park Jongdae and Kim Geonwoo stated, "We applied a fair price-to-earnings ratio (PER) of 17 times to the cosmetics business value, and calculated the sum by applying a 50% discount to the equity value of HK inno.N's market capitalization."

The company's first-quarter results this year are expected to meet market forecasts. For the first quarter of this year, Kolmar Korea's consolidated sales and operating profit are estimated to be 705.9 billion won and 64.1 billion won, up 8% and 7% year-on-year, respectively.

The analysts noted, "Domestic business sales are showing a high growth rate of 22% year-on-year, and the growth rate of the China (Wuxi) subsidiary's sales remains stable at 8%." However, they added, "Sales in North America are expected to decline by more than 40%, so due to sluggish overseas business, the consolidated operating margin is projected to be 9.1%, a 0.1 percentage point decrease from a year earlier."

The key period to watch is the second quarter of this year. The analysts commented, "The domestic business is absorbing the global momentum of K-beauty, and the 19% year-on-year increase in cosmetics exports in the first quarter is fully reflected." They also pointed out, "Orders from major existing clients such as Gudaiglobal, Dalbaglobal, and Olive Young are on the rise."

They continued, "At this pace, growth of nearly 20% year-on-year can be sustained in the second quarter as well. Starting in the second quarter, it will be the peak season for sun care products, and clients who left last year are also showing recovery, which is expected to help overcome the sluggish performance of domestic and overseas affiliates."

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