[Click eStock] "JVM, Continued Low Growth This Year... Target Price Downgraded"

Shinhan Investment Corp. downgraded the target price of JV M to 31,000 KRW on the 4th, citing continued low growth this year, marking a 27.9% decrease from the previous target. The investment rating was maintained at 'Buy.'

Researchers Choi Seunghwan and Lee Byunghwa explained, "Due to market adjustments, the target price-to-earnings ratio (PER) was lowered from 17 times to 13 times, leading to a downward revision of the target price. The 2025 PER is expected to be around 8 times, which is historically low, and since growth is anticipated to resume next year, it is a good time for bottom-fishing."

The two researchers forecasted, "2024 will be a year of pause, with domestic demand affected by a medical crisis and exports impacted by changes in French distribution channels. Following the third quarter, the fourth quarter sales growth rate is also expected to remain in the low single digits."

In fact, low growth persisted in the third quarter of this year. Quarterly sales increased by 1.4% year-on-year to 37.4 billion KRW, and operating profit rose by 26.4% to 7.4 billion KRW. By segment, domestic sales were 20.4 billion KRW and exports 16.9 billion KRW, with a higher export ratio improving profitability.

Nonetheless, they noted, "The foundation for growth in 2025 is secured," adding, "Domestic sales are expected to be at least as high as this year’s, and exports are projected to recover double-digit sales growth due to normalization of distribution channels and increased sales of robotic arm equipment priced at 1 billion KRW per unit."