[Click eStock] "Jeju Maekju, Explosive Growth in Craft Beer Market... Expected to Be the Biggest Beneficiary"

[Asia Economy Reporter Park Jihwan] Yuanta Securities evaluated Jeju Beer on the 16th as the undisputed number one company in the domestic craft beer market, expecting it to be the biggest beneficiary of the explosive market expansion. Jeju Beer is the leading company with a 28% market share in the domestic craft beer market as of last year and was the first in the industry to be listed on the KOSDAQ market in May this year through the Tesla requirements.

Jeju Beer's flagship product is Jeju Wit Ale, a tangerine-flavored beer emphasizing the geographical characteristics of Jeju Island. As of last year, the sales proportion by product was Jeju Wit Ale 50%, Jeju Pelong Ale 23%, Jeju Slice 8%, and other collaboration products 19%. By channel, convenience stores accounted for 60%, large supermarkets 20%, and pubs 20%.

Researcher Park Jinhyung of Yuanta Securities stated, "The explosive growth of the craft beer market is ongoing, with the domestic craft beer market expected to grow at an average annual rate of 46% from 118 billion KRW last year to 370 billion KRW by 2023." The market growth factors are analyzed to be due to price competitiveness secured by the revision of the liquor tax law, the spread of stay-at-home and solo drinking trends due to the COVID-19 impact, and supply expansion due to the increase in the number of craft beer companies.

Among them, Jeju Beer is cited as the leading company. It is analyzed that it is expected to maintain the number one position by securing core competitive advantages. Key to launching unique new products is the ‘Jeju’ identity and brewing know-how and recipes acquired from Brooklyn Brewery, the number one company in New York, and it has secured the largest domestic craft beer production scale of 70 billion KRW annually. Additionally, it is the only company in the industry to be listed in the five major convenience stores and four major supermarkets.

Jeju Beer's performance last year was 21.6 billion KRW in sales and an operating loss of 4.4 billion KRW. Researcher Park Jinhyung analyzed, "This year, it is expected to succeed in a turnaround, with sales estimated to grow 123.8% year-on-year to 49.5 billion KRW and operating profit to reach 1.3 billion KRW."

Researcher Park said, "Expansion of convenience store entry rate (15% in 2020 → 30% in 2021), increased annual production through an OEM production contract with Lotte Chilsung, product line expansion to include dark beer, non-alcoholic beer, and lager beer, and overseas expansion utilizing Brooklyn Brewery's distribution network are expected," adding, "It is the most attractive company in the domestic craft beer market with long-term growth momentum secured."