[Click eStock] "CJ Daehan Tongun, Market Share and Profitability Recovery Are Key"

[Asia Economy Reporter Hwang Yoon-joo] Daishin Securities evaluated on the 12th that attention should be paid to CJ Logistics' market share and profitability recovery this year. The investment opinion 'Buy' and the target price of 130,000 KRW were maintained.

Yang Ji-hwan, a researcher at Daishin Securities, stated, "The operating profit for the fourth quarter of 2022 was 112.3 billion KRW, in line with market expectations." By business division, the courier service met expectations, and the profitability of the CL division exceeded expectations. However, the forwarding and global divisions fell short of expectations, Yang explained.

Researcher Yang expressed concern, saying, "E-commerce (Fulfillment & new LMD) volume is growing due to an increase in clients from expanded sales to Naver sellers and specialized malls, but the average unit price continues to decline."

In the fourth quarter, e-commerce handled volume recorded 16.07 million boxes, a 67.6% increase compared to the same period last year, but sales only increased by 26.7% to 63.2 billion KRW.

Yang said, "The e-commerce handling unit price was 3,932 KRW, down 21.3% compared to the same period last year," adding, "A slowdown in growth of general courier services is expected due to economic downturn," and analyzed, "It is necessary to focus on recovering the market share lost due to the 2022 strike and restoring profitability through price increases."

He emphasized, "It is especially important to confirm the minimization of volume loss due to the courier price increase initiative and the halt of the decline in e-commerce handling unit prices." He added, "We also need to watch the part where sales in the global and forwarding divisions have turned to a decline for the first time in five quarters."