[Click eStock] "Kangwon Land, Target Price 20,000 Won... Core Driver is Government Regulation Relaxation"

Daishin Securities on the 17th newly issued a buy rating and a target price of 20,000 KRW for Kangwon Land.

Im Su-jin, a researcher at Daishin Securities, said, "The target price was calculated by applying a target PER (price-to-earnings ratio) of 17 times to the 2024 EPS (earnings per share) of 1,147 KRW," adding, "The current stock price is judged to have already reflected all negative factors."

Kangwon Land announced its business plan through 2032 on the 2nd under the theme of "A New Leap for a Global Integrated Resort," but the major initiatives announced cannot proceed unless government deregulation is preceded.

Daishin Securities viewed the government's deregulation as the core growth driver for Kangwon Land. They judged that there is a high possibility of government deregulation measures to block the outflow of overseas funds due to the establishment of the Osaka integrated resort in 2029 and to stabilize the regional economy. Although the timing and details of deregulation are difficult to predict, it is expected that the announcement at the current stock price level, which does not reflect any expectations, will likely lead to a stock price increase.

Sales in 2024 are expected to slightly grow to 1.439 trillion KRW, with operating profit reaching 297 billion KRW compared to the previous year. Earlier this year, the Ministry of Culture, Sports and Tourism passed a partial amendment to the Tourism Promotion Act in the National Assembly plenary session, which defined "casino-like acts" and provided grounds to sanction similar acts in the casino industry. This is expected to improve the recovery of sluggish traffic caused by illegal online gambling and the prevalence of hold'em bars in the metropolitan area.

However, it is anticipated that it will take time to see meaningful effects. The number of visitors in 2024 is expected to be 2.53 million. The drop amount is interpreted as 5.9 trillion KRW, reflecting the decrease in per capita drop amount back to the 2019 level after an increase during the COVID-19 period.