[Click eStock] "LG Uplus to Accelerate Qualitative Growth Starting Next Year"

Increasing 5G Subscriber Share and Partnering with Disney
Restructuring Media Business This Year... Qualitative Growth from Next Year

[Asia Economy Reporter Minwoo Lee] LG Uplus, which has been maintaining solid performance, is expected to achieve qualitative growth starting next year.

On the 25th, Samsung Securities maintained its 'Buy' rating on LG Uplus and raised the target price by about 8.6% to 19,000 KRW. The previous trading day's closing price was 14,850 KRW.

For the third quarter, consolidated sales are expected to reach 3.4836 trillion KRW and operating profit 273.3 billion KRW, representing increases of 4.3% and 8.8% respectively compared to the same period last year. This aligns with market consensus estimates of 3.4681 trillion KRW in sales and 275.6 billion KRW in operating profit.

The increase in subscribers for Mobile Network Operators (MNO) and Mobile Virtual Network Operators (MVNO), along with continued growth in the IPTV business, is interpreted as the driving force. At the end of the third quarter, the proportion of 5G subscribers is estimated to be about 37% of total handset subscribers. This is a 3.8 percentage point increase from the previous quarter, indicating steady progress toward the annual target of 40%.

The corporate sector is also steadily increasing orders, expanding its scale. Minha Choi, a researcher at Samsung Securities, stated, "Although marketing expenses increased in the third quarter due to the launch of flagship models, this is within the expected range," adding, "Recently, sales commissions have structurally stabilized, which is positive for profitability."

The outlook is also bright. LG Uplus has signed a mobile and IPTV partnership contract with Disney Plus, which is scheduled to launch domestically next month. It is expected to release mobile plans aligned with the launch date and integrate Disney Plus on IPTV and LG HelloVision's cable TV. Researcher Choi predicted, "This will help increase loyalty by reducing churn rates among existing customers and expand the new customer base."

The subsidiary 'MediaLog' currently operates three broadcasting channel usage business (PP) channels, including The Kids (formerly Disney Channel), which was recently acquired. Along with the expansion of the PP business, the competitiveness is expected to improve as self-produced programs are gradually added to these channels. Researcher Choi explained, "If the media business structure was reorganized this year, next year the business is expected to proceed in a direction that accelerates qualitative growth."