Zinus Aims to Surpass Leading Furniture Stocks

Market Cap 1.4561 Trillion KRW, Hansem Closely Chasing No.1... Positive Impact from Easing US-China Trade Dispute

[Asia Economy Reporter Eunmo Koo] Mattress and furniture manufacturer Zinus is aiming to become the leading furniture stock.

According to the Korea Exchange on the 17th, Zinus's stock price closed at 102,500 KRW the previous day. During the session, it rose to 105,000 KRW, setting a new 52-week high. Since the beginning of this year, Zinus has recorded a 10.5% gain, and since its listing on the KOSPI market on October 30 last year, it has achieved a 39.5% return, continuing its rapid growth.

As the stock price has followed an upward trajectory, the market capitalization has steadily increased. Based on the previous day's closing price, Zinus's market cap reached 1.4561 trillion KRW, up nearly 300 billion KRW from 1.1792 trillion KRW on its first day of listing. Furniture companies such as Ace Bed (380.9 billion KRW), Fursys (330 billion KRW), Hyundai Livart (270 billion KRW), and Enex (74.3 billion KRW) have already been left behind, and Zinus is closely pursuing Hanssem (1.8097 trillion KRW), aiming to claim the top spot in the furniture sector.

It is analyzed that the easing of the US-China trade dispute has created positive expectations for improved business conditions for Zinus. Until now, Zinus has shared the 25% US tariff imposed on furniture products manufactured in its Chinese factories equally with Amazon. However, on the 15th, the US and China signed a Phase One trade agreement, signaling a relaxation of the trade dispute, which is expected to reduce Zinus's tariff burden.

Researcher Hangyungrae from Daishin Securities forecasted, "Since the furniture sales proportion is expected to be high at 41% this year, a reduction in tariff rates will improve costs, potentially increasing operating profit by more than 40 billion KRW." Researcher Seungdoo Na from SK Securities also explained, "Due to the sale of products manufactured in Chinese factories mainly in the North American region, there was a tariff burden from the US-China trade dispute, but concerns have eased as the Phase One trade negotiations concluded positively."

The structural benefit of the expanding online market is also expected to continue. According to market research firm Statista, the US online furniture market is projected to grow from 38.7 billion USD in 2017 to 56 billion USD in 2023, at an average annual growth rate of 6.4%. During the same period, the online market share within the total furniture market is expected to expand from 15.1% to 21%. Zinus is the number one mattress seller in the US online market, with six of the top ten best-selling mattresses on Amazon, the largest online retailer in the US, being Zinus products.

With improving business conditions, sales are expected to surpass 1 trillion KRW this year. According to financial information provider FnGuide, Zinus's sales this year are estimated to increase by 23.3% year-on-year to 1.0058 trillion KRW. Operating profit is also expected to rise by 30.0% to 152.6 billion KRW during the same period.