[Click eStock] "Hansome to Continue Stable Growth"

Offline Normalization and Continued High Growth in Online Sector

[Asia Economy Reporter Minwoo Lee] Hansome is expected to continue stable earnings growth. While online sales continue to grow, offline sales are also recovering, securing stable profitability.

On the 25th, Hyundai Motor Securities maintained its investment opinion of 'Buy' on Hansome and a target price of 60,000 KRW. The closing price the previous day was 37,650 KRW.

In the third quarter of this year, consolidated sales reached 296.4 billion KRW and operating profit was 31.8 billion KRW, up 13.48% and 41.05% respectively compared to the same period last year. These results exceeded market consensus by 0.38% and 9.82%, respectively. Although there was an impact from the social distancing level 4 raised in July, sales growth recovered from August as normalization resumed. Online sales continued to grow rapidly, and business sectors including character and casual wear all showed growth.

Both the fourth quarter and next year are expected to see continued favorable profit growth and improved profitability. The premium cosmetics brand 'Oera', launched in the third quarter, is expected to enter duty-free shops by the end of this year at the earliest and department stores in the first quarter of next year. Additionally, a perfume select shop is planned to open in the first quarter of next year.

Hyundai Motor Securities analyst Hyejin Jeong said, "The business conditions and traffic of major distribution channels such as offline and front-end department stores are improving, leading to a recovery in domestic clothing sales. Online sales, which operate on the company's own mall?a relatively high-margin platform?are growing rapidly with good profitability, and offline sales are normalizing due to improved clothing market conditions, making stable profit growth possible in 2022."