[Click eStock] "Samsung Bio 1Q Earnings Surprise Expected... Accelerating Growth Engine"

[Asia Economy Reporter Hwang Yoon-joo] Daishin Securities maintained its investment opinion of 'Buy' and a target price of 1.1 million KRW for Samsung Biologics on the 14th, expecting first-quarter results to exceed estimates and growth momentum to accelerate from the second quarter.

Im Yoon-jin, a researcher at Samsung Biologics, stated, "The consolidated first-quarter sales are expected to reach 480.4 billion KRW, an 84.2% increase compared to the same period last year, and operating profit is expected to be 157.1 billion KRW, a 111.5% increase, surpassing the consensus (sales 465.6 billion KRW, operating profit 154.8 billion KRW)."

Researcher Im explained the background of the strong performance: "Compared to the previous quarter, the increase in the operating rate of Plant 3, the rise in the KRW/USD exchange rate, and the increase in other sales due to the production of Moderna COVID-19 vaccine drug product (DP) are expected to contribute to favorable performance growth."

[Image source=Yonhap News]

Researcher Im stated, "For 2022, consolidated sales are expected to increase by 25.9% year-on-year to 1.9744 trillion KRW, and operating profit is expected to rise by 20.4% to 646.8 billion KRW."

He analyzed, "Although annual results are expected to slightly decrease when reflecting Samsung Bioepis's consolidated performance from the second quarter, stable growth is anticipated due to the launch of follow-up products such as the Humira biosimilar in the U.S. in 2023."

He added, "During the second quarter, a land purchase contract is expected to be signed for approximately 110,000 pyeong with an acquisition price of 426 billion KRW to begin construction of Plant 5 and expand the 2nd Bio Campus. As announced at the JP Morgan Healthcare Conference earlier this year, the visibility of new plant expansion is increasing, which is expected to accelerate securing future growth drivers."