Yuanta Securities Korea projected on the 30th that Shinsegae's performance will improve starting from the second quarter of this year (April to June). Yuanta Securities Korea maintained its investment opinion of 'buy' for Shinsegae and raised its target price from 170,000 won to 250,000 won. This is 32% higher than Shinsegae's closing price of 188,900 won on the 27th.
Lee Seung-eun, a researcher at Yuanta Securities Korea, estimated that Shinsegae's second quarter performance will reach 1.624 trillion won in sales and 83.5 billion won in operating profit. This is lower than the market's expected operating profit of 97.8 billion won. The researcher cited 'the burden of fixed costs due to construction at the main department store and continuous losses in the duty-free business' as reasons.
In particular, in the case of the Shinsegae duty-free institutional sector, the operating loss temporarily decreased in the first quarter of this year (January to March) due to the effect of a return of 4.5 billion won in patent fees, but it is expected to return to a loss structure in the second quarter, according to the researcher.
The researcher noted that starting in the second half of this year, sales and operating profits will gradually improve, mainly in the Shinsegae department store sector, due to a base effect and recovery in consumer sentiment. The duty-free sector is also expected to reduce its losses through sales recovery at city duty-free shops and cost efficiency.
The researcher stated, 'Given that Shinsegae's fixed cost burden is concentrated in the first half, I expect the consolidated operating profit in the second half to show a clear recovery trend compared to the same period last year.'