LS Securities said on the 6th that CLASSYS is expected to continue step-by-step growth as Brazil sales normalize this year and growth in the United States and Europe gains momentum. It raised its target price to 70,000 won from 65,000 won and maintained a buy rating. CLASSYS closed at 56,600 won in the previous session.
In the fourth quarter of last year, CLASSYS' revenue is expected to be 95.7 billion won, up 29% from a year earlier, and operating profit 50.3 billion won, up 41%. Cho Eun-ae, an analyst at LS Securities, said, "Uncertainty over Brazil sales eased as a decision was made on Oct. 24 last year to acquire the distribution partner, and sales are in the process of normalizing on a monthly basis," and "in its first year of entry, the U.S. BallnuMer exceeded its annual sales guidance of 300 units last year, and sales of MPT and BallnuMer in Europe are also growing."
This year's expected revenue and operating profit are 455.1 billion won and 243.8 billion won, up 34% and 44%, respectively, from a year earlier. LS Securities estimated that CLASSYS' Brazil sales can recover to the 2024 level (about 47 billion won), and U.S. sales will surge 83% and European sales 92% over the same period.
Cho said, "High growth in sales in existing Asian countries such as Thailand and Japan will also continue," and added, "When the acquisition of the Brazil distribution subsidiary is completed, our equipment sales recognition standard will shift from the previous wholesale price to the final supply price, which will also have a revenue-increasing effect."
She added, "Although the margin on a consolidation basis will decline due to the expense burden of operating the local subsidiary, if future Brazil sales outperform expectations, the operating leverage effect could provide an additional driver of profit growth."