[Click eStock] "ASEMS, Rapid Growth Due to Increasing Demand for Running Shoes"

On the 14th, Kiwoom Securities forecasted that Asems' sales of new product lines will rapidly grow due to increased demand for running shoes.

Oh Hyunjin, a researcher at Kiwoom Securities, stated in a report on the same day, "The recovery in performance continues as demand for Adidas and New Balance increases, driven by running trends. Given the limited competitive structure of the shoe manufacturing ODM market, the growth of various brands following recent changes in consumer trends is also positive for the company, and it is understood that collaborations with global sportswear companies beyond the existing major shoe brands are underway."

Researcher Oh Hyunjin added, "The company has been preparing various new businesses, including the development of eco-friendly products using new materials. Although plans to expand new products were delayed due to past client downturns and reduced investment capacity, with recent demand recovery, the performance of new products is expected to accelerate."

He particularly highlighted the performance of 'U-web,' a net-type fabric applying eco-friendly yarns. He analyzed, "Efforts were made to apply U-web to clothing such as underwear by improving adhesion performance and securing breathability and elasticity, but recently, rapid results have been observed mainly in sports shoes like running shoes. We expect mass production to begin next year through sample deliveries to major clients."

He also noted, "With increased deliveries of products such as glitter sheets, the proportion of new product sales next year is expected to account for 25%. Asems' performance forecast for next year is sales of 80.3 billion KRW and operating profit of 17.9 billion KRW, representing growth of 36% and 80% respectively compared to the previous year."

Finally, he stated, "Asems' current stock price is at a price-to-earnings ratio (PER) of 7 times based on next year, which does not reflect the recovery of the core business and expectations for new products. The listing of the Indonesian subsidiary and the ongoing dividend policy are also factors enhancing corporate value."