[Click eStock] "Cheongdam Global, Improving Profitability through Product and Channel Diversification"

KB Securities analyzed on the 12th that Cheongdam Global has achieved profitability improvement through product and channel diversification.

Cheongdam Global, established in 2017, is an e-commerce company that distributes products such as cosmetics as a primary vendor for leading Chinese platforms like JD.com.

Additionally, based on consumer big data analysis, it provides comprehensive solutions encompassing consulting, marketing, and distribution to brand companies aiming to enter the global market.

In the first quarter, consolidated sales reached 54.8 billion KRW, operating profit was 2.4 billion KRW, and the operating profit margin was 4.4%. Sales in the distribution sector amounted to 41.7 billion KRW, with an operating profit of 1 billion KRW. Although cosmetics sales declined, sales of other products (eco-friendly oils, coffee, etc.) showed significant growth. The decrease in cosmetics sales is attributed to the diversification of distribution channels within China (TikTok, Kuaishou, Xiaohongshu, etc.), which led to a decline in sales from JD.com, previously a major revenue source. Despite the sales decrease, the operating profit margin improved by 1.3 percentage points due to an increased proportion of domestic cosmetics sales. Biovizju (filler manufacturing and sales) recorded sales of 6.4 billion KRW and an operating profit of 2.6 billion KRW. Baishuko posted sales of 2 billion KRW and an operating loss of 900 million KRW.

In 2024, the distribution sector plans to pursue external growth by revitalizing the distribution of domestic brands and expanding sales through the B2C live commerce platform, while strengthening marketing capabilities by building networks with influencers. The subsidiary Biovizju plans to list on the KOSDAQ market in the first half of 2025. Leveraging the growth of K-pop, Cheongdam Global acquired 100% of Idol Store's shares last January to enter the idol goods market, which has been expanding annually. Since its establishment in 2021, the platform has accumulated 300,000 registered users within three years and is preparing its first offline store in Hongdae.

Shinae Park, a researcher at KB Securities, stated, "The risk factors include high sales dependence on a single country (China), channel (JD.com), and category (cosmetics). During the process of business diversification to address this, performance volatility appears somewhat high."