[Click eStock] "Samsung Card, Steady Increase in Card Usage Amount... Focus on Earnings Improvement"

[Asia Economy Reporter Ji-hwan Park] On the 30th, Korea Investment & Securities highlighted the need to pay attention to the performance improvement trend of Samsung Card, reflected in the steady increase in card usage amounts. The investment opinion 'Buy' and the target price of 44,000 KRW were maintained.

Baek Doo-san, a researcher at Korea Investment & Securities, stated, "The steady increase in usage amounts, an annual 6-8% increase in card loans, and improvement in soundness are key," adding, "With an expected dividend yield of 6.8% acting as a downside support for the stock price, attention should be paid to the performance improvement factor of consumption recovery."

Samsung Card's third-quarter net profit is expected to be 136.4 billion KRW, a 7% increase compared to the previous year, in line with market expectations. The amount of personal credit sales (new sales) is projected to increase by about 10-13% year-on-year. Researcher Baek explained, "The industry's personal card approval amount in the third quarter is expected to increase by 6-7% compared to the same period last year," adding, "This is because Samsung Card's personal new sales market share has been on an upward trend since the second quarter of last year, after the Costco exclusion effect ended." The rise in market share is attributed to an increase in per capita transaction volume due to improved member efficiency, with strong usage performance in online shopping, department stores, and home appliances sectors.

There is also an analysis that the card loan business is performing better than concerns suggested. He said, "Considering the financial sector's household debt growth target of 6% and incentives for mid-interest loans, the annual card loan growth rate is expected to be managed between 6-8%," emphasizing, "The balance growth rate in the second quarter compared to the end of last year is 3%, leaving room compared to the target, and considering the overall high demand for card loans in the market, the third-quarter card loan performance is expected to be favorable."

However, the revision plan for merchant fees, the procedure for selling 20% of Renault Samsung's shares, the rise in corporate bond interest rates, and the potential slowdown in the growth rate of new car installment usage amounts were pointed out as risk factors.