Hanssem, Sales Expected to Increase Due to Rising Home Decoration Demand Amid COVID-19 Impact

Samsung Securities Report, Target Price Up 19%
Expecting Increased Performance in Rehouse Division Next Year

[Asia Economy Reporter Minji Lee] On the 5th, it was forecasted that Hanssem's furniture sales would significantly increase due to the rising demand for 'home decorating' influenced by the novel coronavirus infection (COVID-19).

Researcher Bang Gwan-seok of Samsung Securities said, "Despite the impact of COVID-19, most building material companies have maintained higher stock prices compared to the beginning of the year," and added, "Along with unexpectedly strong first-quarter earnings, there seems to be an expectation that the spread of COVID-19 could lead to a short-term increase in demand for interior furniture."

Hanssem is also expected to see an increase in sales in its interior furniture division. Although operating profit on a consolidated basis for the second quarter is expected to decrease compared to the previous quarter due to the final large-scale restructuring of its China subsidiary, excluding one-time factors, strong furniture sales are expected to rather support overall performance.

Due to the trend of home decorating influenced by COVID-19, interior furniture sales this year are anticipated to deliver better-than-expected results beyond the baseline effect.

The Rehouse division, a mid- to long-term growth model in the second quarter, is judged to experience a slight slowdown in performance in the short term. Previously, the Rehouse division was expected to begin full-scale growth this year. However, due to the impact of COVID-19 causing remodeling projects to stall and anticipated contraction in housing transactions in the second half of the year, the Rehouse division is projected to grow in 2021.

Researcher Bang Gwan-seok said, "Considering the expected increase in interior furniture performance this year and Rehouse business performance next year, we have raised the target stock price by 19% to 105,000 won," and added, "Hanssem is regarded as a beneficiary stock of the changed real estate cycle as a leading comprehensive interior company."