[Click eStock] "CJ CheilJedang, Processed Food Sales Growth to Stand Out... Target Price Up"

Korea Investment & Securities forecasted on the 4th that CJ CheilJedang's sales of high-margin processed foods for export markets will stand out with an increasing trend. They maintained a 'Buy' investment rating and raised the target price from the previous 430,000 KRW to 470,000 KRW.

Researcher Kang Eun-ji of Korea Investment & Securities predicted, "CJ CheilJedang's second-quarter sales will increase by 1.4% year-on-year to 7.3185 trillion KRW, and operating profit will rise by 7.2% during the same period to 369.3 billion KRW, meeting market expectations." She added, "Due to the slowdown in demand for processed foods and the high base of material foods, domestic food business sales likely decreased slightly," and analyzed, "The overseas food business led the overall food division's sales growth by increasing sales through rising market share in the American processed food market based on price competitiveness, as well as expanding mainstream store entries in newly entered countries such as Australia and Europe."

Researcher Kang evaluated CJ CheilJedang's global business strategy as effective. She said, "The food division's sales expansion strategy centered on global strategic products (GSP) such as dumplings, gim (seaweed), and chicken, along with the bio division's profitability strategy by increasing the proportion of specialty amino acid products, will continue to be growth drivers for CJ CheilJedang's performance." She added, "In particular, the rapid penetration of GSP products into processed food markets in countries with high average selling prices (ASP) such as Australia and Europe is expected to lead to further profitability improvements in the food division going forward."