[Click eStock] "HPO, Stock Undervalued Phase"

Kiwoom Securities analyzed on the 2nd that HPO's subsidiary performance is being undervalued, highlighting its attractiveness and expecting an increase in corporate value.

Oh Hyunjin, a researcher at Kiwoom Securities, explained in a report on the same day, "Probiotics are driving company growth with a 28% increase in sales compared to the previous year through category diversification," adding, "The subsidiary BioPharm's sales in 2023 reached 54.5 billion KRW, and with continued growth, the Denmark factory is scheduled to begin operations in 2024."

HPO's mid- to long-term growth is expected to be led by the infant and toddler business sector. HPO merged the scooter brand m-cro, operated by GeoInFinTech, with the children's fashion company Apricot Studio to establish the brand 'Areuneul.' Based on the merged corporation in 2023, sales amounted to 42.1 billion KRW, with an operating profit of 5.9 billion KRW.

Researcher Oh Hyunjin noted, "Despite the decline in birth rates, the increase in consumption capacity for children is expected to sustain growth in related industries," and added, "Stable growth is anticipated based on the existing customer base, and overseas business expansion targeting countries where the parent company has entered is also possible."

Sales for this year are projected at 259.4 billion KRW, with an operating profit of 27.2 billion KRW. Researcher Oh Hyunjin stated, "As interest in the premium infant product market rises due to low birth rates, attention to the subsidiary's infant and toddler business sector will increase," and concluded, "The stock price is undervalued at a price-to-earnings ratio (PER) of approximately 8.6 times based on 2024, and reflecting market competitiveness and mid- to long-term growth potential, corporate value is expected to rise."