[Click eStock] "BGF Retail, Fastest Recovery in Convenience Stores with With Corona"

[Asia Economy Reporter Ji Yeon-jin] Korea Investment & Securities announced on the 5th that it maintains a buy rating and a target price of 220,000 KRW for BGF Retail, stating that with the normalization of school attendance and the recovery of outing demand following 'With Corona,' a rapid recovery in customer traffic within the industry is possible.

Myungjoo Kim, a researcher at Korea Investment & Securities, said, "The attractiveness of BGF Retail, a pure convenience store company that has significantly expanded its stores after COVID-19, is expected to increase," adding, "With a rapid recovery in customer traffic within the industry, an increase in BGF Retail's earnings per share (EPS) is anticipated, which could lead to a rise in its stock price."

BGF Retail reported consolidated sales of 1.8365 trillion KRW in the third quarter, a 9.1% increase compared to the same period last year, and operating profit rose by 9.1% to 69.5 billion KRW. Due to consecutive heavy rains in August this year, the same-store sales growth rate was sluggish at -1.2%, resulting in a third-quarter same-store sales growth rate of 1.5%, which was 2.0% lower than that of the second quarter.

Although operating profit slightly missed market expectations, the steady demand for new store openings was evaluated positively. In particular, the same-store sales growth rate in September was 4.1%, significantly exceeding the market average store sales growth rate of 2.5%. This is interpreted as a successful product differentiation strategy driven by the success of private brand (PB) products such as craft beer.