Eugene Investment & Securities on the 12th said it expects department stores, the Vietnam business, and a greater likelihood of losses narrowing at subsidiaries to lift Lotte Shopping. It maintained a Buy rating and raised the target price to 180,000 won from 93,000 won. Lotte Shopping closed at 145,000 won the previous day.
Lotte Shopping posted first-quarter net sales of 3.58 trillion won and operating profit of 252.9 billion won this year. Compared with a year earlier, net sales rose 3.6% and operating profit increased 70.6%.
Lee Hae-ni, an analyst at Eugene Investment & Securities, said Lotte Shopping's net sales beat the market consensus thanks to favorable conditions at department stores and in the Vietnam division.
Department store revenue rose 8.2% to 872.3 billion won, and operating profit increased 47.1% to 191.2 billion won. Overseas department store revenue also climbed 14.7% to 35.5 billion won, while operating profit surged 268.7% to 7.6 billion won.
The analyst said, "Strong sales at large stores and among foreign customers contributed significantly to results," and noted, "Total sales at Hanoi locations such as Lotte Mall West Lake Hanoi in Vietnam and at department stores in Indonesia are maintaining solid growth."