[Click eStock] "CNC International, Positive on Customer Diversification"

First Half Performance Increase, Second Half Performance Expected to Decline
Sales and Operating Profit Expected to Rise in 2025 with New Projects
Stable Growth with 37% Share of North America, Middle East, and Europe Clients

On the 26th, NH Investment & Securities positively evaluated C&C International for its increasing proportion of overseas sales and plans to pursue a strategy of diversifying overseas clients. No separate investment opinion or target price was provided. The closing price of C&C International on the previous trading day was 47,200 KRW.

According to NH Investment & Securities, the 2024 performance is expected to follow a pattern of strong first half and weaker second half. Consolidated sales for the fourth quarter are projected to be 70.8 billion KRW, a 12% increase year-on-year, while operating profit is expected to decline by 8% to 8.4 billion KRW. This is analyzed to be due more to the company’s reliance on a smaller number of major clients with high sales proportions compared to larger companies, rather than a slowdown in the industry.

In particular, fluctuations in overall sales and profits can be significant depending on the order volume from top clients, the number of new product bids and competition intensity, and the timing of distributors’ direct purchase volume absorption. Projects currently underway, focusing on indie and celebrity brands in the US and Middle East where the ODM (Original Design Manufacturer) business model has not yet been sufficiently expanded, are expected to show tangible results starting in 2025.

In the first quarter of 2025, sales growth is anticipated along with an increase in shipment volume. Consolidated sales for 2025 are expected to reach 354 billion KRW, a 19% increase from the previous year, and operating profit is projected to rise by 29% to 48 billion KRW. The company aims for a total CAPA (production capacity) of 400 million units in 2025 and has sufficient potential for sales expansion through increased production volumes, including 350 million units domestically and 500 million units in China. If collaborations with domestic and international brands and the results of new projects translate into actual shipment volume and sales growth, the stock price is expected to recover rapidly.

Jiyoon Jeong, a researcher at NH Investment & Securities, stated, "Sales to clients in North America, the Middle East, and Europe, which account for 37% of total sales, are maintaining steady levels, and diversification by region and client is expected to have a positive effect."