[Featured Stock] Serim B&G, Rapid Growth in Biodegradable Plastics... Export Momentum to the US and Other Overseas Markets

[Asia Economy Reporter Hyungsoo Park] Serim B&G is showing strong performance. Securities firms' analysis that the biodegradable plastics sector will drive overall future earnings growth appears to be influencing the stock price.

As of 2:16 PM on the 30th, Serim B&G is trading at 3,290 KRW, up 6.13% from the previous day.

Serim B&G is an eco-friendly packaging specialist company. Its business divisions are vacuum forming, eco-friendly, and products. Based on last year's sales ratio, these account for 67.7%, 23.1%, and 9.2%, respectively. The vacuum forming division manufactures and sells packaging containers used for food. The eco-friendly division produces films and packaging materials based on biodegradable plastics. Biodegradable plastics refer to plastics that are 100% naturally decomposed by microorganisms when buried in soil. They are environmentally friendly and harmless to the human body.

Yongho Kim, a researcher at Hanwha Investment & Securities, stated, "The company possesses advanced technologies such as raw material compounding, molding, and processing," and explained, "The high growth trend in the eco-friendly sector, which is gaining momentum, will drive the overall company performance going forward."

He added, "As plastic regulations are strengthened and the application scope of biodegradable plastics expands, Serim B&G is expected to benefit from a first-mover advantage due to its proactive entry into the biodegradable plastics market."

He analyzed, "The company has secured over 150 client companies," and "Since it is still in the early introduction stage, the sales volume per client company is not yet large."

Researcher Kim emphasized, "It is important to note the expanding growth rate," explaining, "Among the clients, iMarket Korea, which has the largest sales volume, showed a sharp increase from 500 million KRW in 2019, 1.7 billion KRW in 2020, to 4.9 billion KRW in 2021."

Furthermore, he stressed, "To expand overseas, sales are being extended mainly in the United States, where delivery references are held," and added, "Export momentum can also be expected."