[Click eStock] "Kangwon Land, Confirmed Demand + Improved Business Environment... Target Price Up"

[Asia Economy Reporter Park Jihwan] Hana Financial Investment stated on the 11th that it confirmed the higher performance level in the second quarter for Kangwon Land due to identified potential demand and improved business environment, maintaining a 'Buy' investment rating and raising the target price by 6% to 33,000 KRW from the previous level.

Researcher Lee Kihoon of Hana Financial Investment said, "We have raised the 2023 potential operating profit forecast from 450 billion KRW to 490 billion KRW after confirming the higher performance level in the second quarter due to identified potential demand and an improved business environment." Despite visitor numbers recovering to only about 30% compared to the past, the speed and strength of performance recovery are considered quite strong enough to reach the breakeven point.

Second-quarter sales and operating profit were 203.6 billion KRW and 2.7 billion KRW respectively, marking a 488% increase and a return to profitability compared to the previous year. Since June 15, Jeongseon has applied social distancing level 1, expanding daily visitors to 3,000?3,300. Although visitors are admitted through a lottery system, limiting the number of visitors, the drop amount per visitor nearly doubled compared to the past under these restricted opportunities.

Researcher Lee said, "The average daily casino reservation customers are at the level of 8,000?9,000, confirming high potential demand," and added, "The recovery of high-stakes tables and the increase of operating hours by 2 hours positively influenced the improved business environment."

Assuming the current stage is maintained, third-quarter sales are expected to improve to about 250 billion KRW, and operating profit to 34 billion KRW. The researcher forecasted, "With the improvement of the business environment, fundamentals are upgraded, and casino sales in 2023 are expected to recover to over 1.6 trillion KRW," adding, "The potential target market capitalization as of 2023 is expected to reach about 8 trillion KRW."