[Click eStock] "Daewoong Pharmaceutical, Q3 Operating Profit Exceeds Expectations... Corporate Value Reassessment"

[Asia Economy Reporter Ji Yeon-jin] Kiwoom Securities forecasted that Daewoong Pharmaceutical's corporate value will be re-evaluated next year as the wrinkle improvement treatment Nabota is launched in Europe and demand in the U.S. expands due to reopening.

Hah Hye-min, a researcher at Kiwoom Securities, stated, "Daewoong Pharmaceutical is in a phase of improving corporate value through performance enhancement, but the stock price has not reflected this due to the recent neglect of the pharmaceutical and bio sectors, which caused a simultaneous decline."

In the third quarter of this year, sales increased by 6% year-on-year to 265.1 billion KRW, and operating profit rose by 241% to 23.9 billion KRW. Operating profit exceeded market expectations by 17%. This is estimated to be due to a greater decline in phosphate cost ratio from product mix improvement. While sales of relatively low-profit products decreased by 1.5% compared to the previous quarter, product sales during this period increased by 4% to 94.2 billion KRW.

The proportion of product sales within prescription drugs (ETC) rose by 2 percentage points year-on-year to 48%, and it is analyzed that treatments such as Ritovaget for dyslipidemia, Crezet for hyperlipidemia, and Acid for anti-ulcer also continued to grow.

Daewoong Pharmaceutical is expected to launch the new drug Pexuprazan for gastroesophageal reflux disease in the second quarter of next year following its approval at the end of this year, and it is positively evaluated that high-margin products will be consecutively introduced with the launch of a new diabetes drug in 2023. Additionally, Nabota, an existing high-margin product, is expected to see gradually increasing demand in the U.S., with exports in the fourth quarter projected to increase by 60% year-on-year to 15 billion KRW.