Shinsegae Inter Faces Fashion Business Slump... Target Price Down 19%

NH Investment & Securities on the 23rd lowered the target price of Shinsegae International to 17,000 KRW, a 19% decrease. This is based on the expectation that earnings will continue to underperform for the time being, as the third-quarter results fell short of initial forecasts.

Shinsegae International_Cheongdam Building

Jiyoon Jeong, an analyst at NH Investment & Securities, stated, "As overall consumption contracts, demand for luxury goods is decreasing, and the performance of the fashion business, which holds high-priced imported brands, is deteriorating."

He also revised down Shinsegae International's third-quarter sales and operating profit guidance by 3% year-on-year to 307.5 billion KRW and 5.9 billion KRW, respectively. The operating profit forecast is 38% below the previous estimate.

He added, "From the fourth quarter, there is still a possibility of a performance rebound as the company's own cosmetics brand enters the North American market through its U.S. subsidiary, and Amuse, a cosmetics brand popular among the MZ generation, is consolidated as a subsidiary."