"Despite Price Hike, Buldak Exports Surge... Samyang Foods’ Strong Performance Continues [Click e-Stock]"

There are expectations that Samyang Foods will continue its growth trajectory, driven by sustained overseas demand and an expansion of supply to match.

On April 21, DS Securities maintained its target price for Samyang Foods at 1.9 million won and its "Buy" investment rating, citing these factors. The previous day's closing price was 1,377,000 won.

For the first quarter of this year, the company is expected to post consolidated sales of 674.4 billion won and operating profit of 164.2 billion won. These figures represent year-on-year increases of 27.5% and 22.6%, respectively. The operating margin is estimated at 24.4%. The company is projected to achieve solid growth in line with market expectations.

Overseas demand, in particular, has been identified as a key driver. The company has reported balanced growth across all regions, including the United States, China, and Europe. The U.S. subsidiary continued its growth by quickly selling out inventory despite price increases at the end of last year and replenishing its shortfall in January with additional supply in February and March. The Chinese subsidiary appears to have expanded its sales by depleting inventory stockpiled in anticipation of logistics disruptions during the holiday season. In Europe, growth is being driven by an increased presence in key markets such as the United Kingdom.

In contrast, domestic sales are expected to be somewhat limited, reaching 105.5 billion won in the first quarter, an increase of just 0.4% year-on-year. This is believed to be the result of prioritizing supply for exports. In terms of profitability, an increased portion of sales from overseas and favorable exchange rate effects are expected to support earnings growth.

Signs of growth have also emerged recently. Monthly export data for Samyang Foods' ramen have been rising sharply. While the average for January and February was 85.89 million dollars, similar to last year's monthly average, exports surged to 116 million dollars in March, representing a 40% increase year-on-year and a 35% increase from the previous month. Preliminary figures for ramen exports from April 1 to 10 also show continued strong performance, raising expectations for second-quarter results.

Demand remains robust in every region, including the United States, China, Europe, and Southeast Asia. Supply has also increased, thanks to the expansion of the two-shift line at the Miryang Plant No. 2 and improvements in line efficiency. The new plant in China, which required an investment of 207.2 billion won, is expected to open in January next year, likely further boosting overseas performance.

Jang Ji-hye, an analyst at DS Securities, explained, "Samyang Foods' earnings per share (EPS) growth rate is expected to reach 35% this year, and the company is continuing to achieve stable earnings growth compared to domestic and global competitors, even amid heightened internal and external uncertainties."

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