[Click eStock] Cosmecca Korea, Expecting Industry Improvement This Year... Gradual Profitability Recovery Anticipated

[Asia Economy Reporter Hwang Yoon-joo] Yuanta Securities maintained a 'Buy' investment rating and a target price of 22,000 KRW for Cosmecca Korea on the 24th, stating that although the company's Q4 performance last year significantly missed estimates, the business conditions are expected to improve this year.

Researcher Park Eun-jung of Yuanta Securities said, "With the easing of social distancing measures in 2022, an improvement in business conditions is anticipated, so gradual expansion in scale and recovery in profitability are expected."

Researcher Park explained, "We forecast consolidated sales of 440 billion KRW (YoY +11%) and operating profit of 23.6 billion KRW (YoY +17%) for 2022," adding, "We assumed sales growth rates by corporation of +11% domestically, +20% in China, and +8% in the United States."

He analyzed, "In China, losses are shrinking due to rapid scale expansion, and the breakeven point will be surpassed in 2022," and "Although there is a base burden in the U.S., scale growth will continue due to customer expansion and an increase in order items."