Sangsangin Investment & Securities forecasted on the 10th that BioPlus, which manufactures hyaluronic acid (HA) based fillers and cosmetics, will see significant growth this year. Sangsangin Investment & Securities first presented a 'buy' investment opinion on BioPlus and set a target stock price of 10,000 won, which is 44.9% higher than BioPlus's previous trading day closing price of 6,900 won.
Ha Tae-ki, a researcher at Sangsangin Investment & Securities, mentioned that the expected improvement in BioPlus's performance is attributed to filler exports. Since the first half of last year, BioPlus has transitioned its filler distribution structure from low-cost research, development, and manufacturing (ODM) companies to direct exports and large transactions. As a result, it is estimated that filler sales have begun to rise again since the fourth quarter of last year.
The researcher noted, "This year, filler sales are projected to increase by 52.3% compared to last year, reaching 76.6 billion won," adding, "With additional growth in medical devices and cosmetics, BioPlus's total sales are expected to reach 93.8 billion won and operating profit 40 billion won, which is an increase of 41.3% and 70.9%, respectively, from the same period last year."
Another positive factor is that BioPlus is investing 150 billion won in constructing a factory in Eumseong, Chungbuk Province. When the new factory is completed this year, the production capacity (CAPA) for HA fillers will increase from 5.4 million annually to 40 million. They are also going through the approval process for entering the U.S. and Chinese markets.
The issue is the burden of overhang (potential selling pressure). There are 60 billion won in convertible bonds, with a conversion price of 6,550 won per share. The conversion period starts from July 31. At the current stock price level, about 15% of the number of issued shares may be flooded with new shares. The researcher stated, "If BioPlus's performance in the first half of the year meets the projected level, the stock price can rise enough to absorb the convertible bond volume."