[Click eStock] "CJ CheilJedang, Major Products Continue to Gain Market Share in the US... Target Price Up"

Target Price Raised by 9% Compared to Previous Estimate

NH Investment & Securities raised the target price for CJ CheilJedang from 430,000 KRW to 470,000 KRW on the 12th, citing a continuous increase in market share of key products in the U.S. market. The investment rating was maintained as 'Buy.'

Joo Young-hoon, a researcher at NH Investment & Securities, stated, "We have raised the target price by 9% compared to the previous level, reflecting the value increase of major business divisions. Amid growing attention to the export momentum of food companies overseas, CJ CheilJedang is also continuously increasing the market share of its key products in the U.S. market. The valuation is also lower than the industry average, making it an accessible range without burden."

It is expected that the performance of all major business divisions will continue to improve in the second quarter of this year. Researcher Joo analyzed, "On a consolidated basis for Q2, sales are estimated to have increased by 3% year-on-year to 7.4574 trillion KRW, and operating profit is expected to have grown by 9% to 374 billion KRW. Food division sales are projected to rise slightly by 1% year-on-year to 2.7659 trillion KRW. Domestic sales are expected to show slight growth compared to the previous year due to the recovery in processed food demand, despite a continued decline in sales in the materials division. Overseas business is affected by a decrease in sales due to the sale of the Chinese subsidiary Jisangjwi, but in the key market of the U.S., the market share of major products continues to expand." The bio division is expected to see slight profit growth, including CJ Selecta, the company scheduled for sale, as core products recover market conditions. The F&C division is estimated to continue improving profitability compared to the previous quarter due to rising pork prices in Vietnam.

There is an expectation of improved financial structure following the completion of the CJ Selecta sale. Researcher Joo said, "If the ongoing sale of CJ Selecta is completed, further upward revisions of performance estimates will be possible," adding, "The inflow of sale proceeds is also expected to improve the financial structure."