Kiwoom Securities said on the 18th that SILICON2 is highly likely to sustain a recovery in North American sales going forward, and that the risk of brand departures feared by the market does not appear large. It raised its investment opinion to Buy and its target price to 65,000 won from 62,000 won. SILICON2's closing price the previous day was 45,100 won.
At the earlier StyleKorean K-beauty conference, Mimibox Chief Executive Ha Hyeong-seok shared a case of collaboration with SILICON2 and emphasized the strategic importance of SILICON2's "all-in-one, one-stop service" in the process of entering the U.S. retail market.
Jo So-jeong, an analyst at Kiwoom Securities, said, "Until now, SILICON2's North American channels raised concerns about brand departure risk due to last year's sales decline," and noted, "However, in light of this Mimibox collaboration case, SILICON2's U.S. channels are expected to continue their growth trend for the time being."
The Mimibox case shows that when a brand enters the United States independently, there is a possibility it will face supply, expense, and financial risks.
In this situation, the analyst said, "Collaboration with SILICON2 proves to be an effective way to resolve these issues," and added, "Therefore, we judge that SILICON2's role is likely to expand in the process of K-beauty brands entering the United States going forward, and the faster brands accelerate their global expansion, the more SILICON2's growth momentum will strengthen."
Meanwhile, SILICON2 posted third-quarter sales of 299.4 billion won and operating profit of 63.1 billion won. These figures rose 60% and 48%, respectively, from a year earlier.