SK Securities on the 27th said APR is expanding into the U.S. offline market and the European online market, leaving ample room for its stock to rise. It kept its Buy rating and raised the target price to 440,000 won from 320,000 won. APR's previous closing price was 317,000 won.
SK Securities projected APR's customer base will expand in the U.S. market. APR's Medicube brand is currently available at "Ulta," known as the "U.S. Olive Young."
Hyeong Gwon-hun, an analyst at SK Securities, said, "Since Medicube launched at Ulta, its sales ranking has been climbing quickly," and noted, "Among all skincare items at Ulta, Medicube ranks fourth, so we expect it will easily post more than 100 billion won in sales at Ulta this year."
Hyeong explained that because Ulta has many loyalty members, APR's customer base is also likely to expand.
Hyeong said, "Ulta has 44.6 million loyalty members, and as much as 95% of total sales comes from members," adding, "With 75% of members understood to use only stores, APR can reach a new customer segment in a separate arena from the U.S. online cosmetics market it focused on last year, so we can expect the effect of a broader customer base."
Improved results for APR in the European market are also expected. Starting in Oct. last year with the United Kingdom, APR plans to make a full-fledged entry into the European online B2C (business-to-consumer transaction) market this year.
Hyeong analyzed, "By targeting the European B2C market, APR can expand B2C sales volume and even extend into offline channels based on B2C recognition," adding, "The United Kingdom was the fastest to onboard B2C channels, and Medicube is already delivering strong results on Amazon UK."
He added, "Starting in Mar. this year with Germany, penetration into B2C channels across other Western European countries is set to begin," and said, "Although languages differ from the U.S., requiring localized marketing by region, considering APR's strong in-house marketing capabilities, the likelihood of successful penetration into the European market is high."