[Click eStock] The Power of 'Bangtan Beer'... Lotte Chilsung Expected to Reduce Beer Deficit

[Asia Economy Reporter Ji Yeon-jin] Hana Financial Investment forecasted on the 9th that Lotte Chilsung will record strong second-quarter earnings due to robust sales of cloud draft beer and craft beer, significantly reducing its deficit this year. Although Lotte Chilsung's stock price has risen 47% since the beginning of the year, there is potential for further increase, making a buy and hold strategy effective.

Sim Eun-joo, a researcher at Lotte Chilsung, stated, "The cumulative beverage and liquor sales of Lotte Chilsung from April to May showed double-digit growth compared to the same period last year," adding, "Due to the base effect from last year and the sharp recovery of convenience store traffic, strong performance is expected in the beverage sector."

Additionally, craft beers such as the convenience store beers 'Gompyo Milmaekju' and 'Jeju Ale,' which have gained great popularity since their launch, entered 'Original Equipment Manufacturing (OEM)' production starting in April. During the first half of the year, the carbonated drink Trevi will also begin production at the beer factory, with Trevi's sales expected to reach 70 billion KRW this year. Considering this, the beer factory's operating rate is projected to expand from 20% last year to 40% this year, and the beer deficit is expected to decrease by more than 20 billion KRW compared to the previous year. There is hope for a turnaround to profitability next year.

Lotte Chilsung's sales for the second quarter this year are forecasted to increase by 8.2% year-on-year to 646.8 billion KRW, with operating profit expected to reach 48.6 billion KRW (+66%).