[Click eStock] "Lotte Chilsung, Strong Sales of New Product 'Saero'"

Hana Securities maintained a buy rating and a target price of 240,000 KRW for Lotte Chilsung on the 30th, expecting that beverage and liquor sales in the first quarter of this year will increase by 7% and 9.2% respectively compared to the same period last year due to strong sales of new products.

This year, the liquor market's performance and stock price direction are expected to vary depending on the market share trends of each company's new products. Eunju Shim, a researcher at Hana Securities, explained, "The key is the new penetration rate," adding, "Lotte Chilsung's soju market share fell from 20% in 2018 to 11% in 2020 due to the 2019 Japanese boycott movement."

She continued, "It is understood that the share recovered to around 15% last year," and said, "If new sales contributions expand to 130 billion KRW this year as targeted by Lotte Chilsung, an additional market share gain of about 5% is possible." Monthly sales contributions in January and February were each estimated to be around 10 billion KRW, which is analyzed as not an aggressive figure. When Hite Jinro launched the new product Terra in March 2019, sales increased by 70 billion KRW compared to the previous year in the first year, and by 100 billion KRW compared to 2020.

This year, Lotte Chilsung's consolidated sales and operating profit are estimated to increase by 7.1% and 17.7% respectively compared to the previous year. Consolidated sales and operating profit for the first quarter are expected to be 675.6 billion KRW and 60.1 billion KRW respectively. It is explained that not only the headquarters but also the subsidiaries are undergoing cost efficiency improvements, making steady profit improvement appear possible.