[Click eStock] "'Export Boom' Expected... Nongshim Target Price Maintained"

Hyundai Motor Securities maintained a buy rating and a target price of 520,000 KRW on Nongshim on the 21st, stating that "mid- to long-term expansion into Europe and South America will be in full swing."

On the same day, Heeji Ha, a researcher at Hyundai Motor Securities, said, "Along with export expansion, growth of overseas subsidiaries centered on the U.S. from the fourth quarter of this year, as well as efficiency improvements in domestic costs and promotional expenses, are expected to drive an upward trend in the stock price."

Researcher Ha noted, "The domestic sector has shown somewhat sluggish demand for snacks and ramen in the second half due to weak domestic consumption," adding, "Although it is unlikely that domestic consumption will improve significantly in the short term next year, the weak domestic demand can be offset by strong export performance."

In particular, growth has begun centered on three Western European countries. The cumulative ramen export value to Europe in the third quarter was approximately 94 billion KRW, and it is expected to exceed 100 billion KRW this year. To support this, a European sales subsidiary is being considered for the first quarter of next year, and with the goal of completing a dedicated export factory in Korea by 2026, mid- to long-term growth is anticipated.

The overseas sector showed somewhat sluggish performance, with growth in the Americas slowing until the third quarter of this year. However, a full-fledged recovery in earnings centered on the U.S. is expected in the fourth quarter. Researcher Ha said, "Following the start of operations of the second U.S. plant's cup noodle line last month and the relocation to Walmart's main shelves, sales of the U.S. subsidiary are expected to grow," adding, "In China, delayed Yubei online sales may normalize next year. Price increases in Australia and Vietnam will also be reflected."