[Click eStock] "Hansol Paper, Profitability to Improve Significantly This Year... Expansion of Eco-friendly Business"

[Asia Economy Reporter Hwang Yoon-joo] Eugene Investment & Securities forecasted on the 24th that Hansol Paper's profitability will significantly improve this year. Accordingly, they initiated coverage with a 'Buy' rating and a target price of 20,000 KRW.

Researcher Park Jong-sun of Eugene Investment & Securities stated, "The consolidated sales for 2022 are expected to increase by 7.6% year-on-year to 1,974.3 billion KRW, and operating profit is projected to rise by 83.4% to 111.3 billion KRW."

Researcher Park anticipated a significant improvement in profitability due to the rise in industrial paper sales prices. He explained, "After Shinpoong Paper ceased its whiteboard paper business, the domestic market share increased from 37.8% in 2019 to 45.5% in 2021."

Researcher Park added, "The sales price of industrial paper reflects cost increases such as maritime freight. Hansol Paper plans to expand its industrial paper production capacity to 740,000 tons annually by the end of this year and intends to focus exports not only domestically but also to Southeast Asia and other regions."

Expanding eco-friendly businesses to secure mid- to long-term growth momentum is also positive. Hansol Paper plans to produce plastic substitute products.

Researcher Park said, "In January this year, by acquiring a 10% stake in Seongwoo NBTec, a food packaging container manufacturer, Hansol Paper has taken the lead in the domestic paper packaging market with its PE-Free (Terabas business)." He added, "Since launching new products in 2021, they have been supplying to Baemin Sanghoe, Ediya, Mychef, Paul Bassett, Ottogi, and others."

He continued, "They are expected to enter the food packaging material business (Proteco business) through raw material supply. Currently, they have supply records with some mask pack and mask packaging companies."