Shinhan Investment & Securities said on the 23rd that d'Alba Global's revenue keeps growing while its valuation is low. It maintained a "Buy" rating and raised the target price to 260,000 won. d'Alba Global's previous closing price was 171,800 won.
Park Hyun-jin, an analyst at Shinhan Investment & Securities, said, "Despite strong revenue growth in the second half of last year, limited additional improvement in the operating margin left the share-price return lagging the cosmetics sector's return."
However, it said d'Alba Global's revenue continues to show strong growth. Park said, "With tighter expense control, this year's operating margin is expected to improve by around 2 percentage points," adding, "Compared with that, the low valuation is an advantage."
d'Alba Global posted consolidated revenue of 163.5 billion won and operating profit of 25.2 billion won in the fourth quarter of last year. That was up 72% and 87%, respectively, from a year earlier. Domestic revenue grew 17% and overseas revenue 125%, with North America, Europe and ASEAN in particular showing sharp increases, according to the assessment.
By revenue scale, Japan grew 151%, North America 207%, ASEAN 79% and Russia 29%, while Europe increased 230%.
Park said, "This year's ratio of marketing expenditure is expected to remain at last year's level," adding, "Revenue can increase mainly through channels with high margin contribution, including business-to-business (B2B) channels, which will raise expectations for operating margin improvement."