[Click eStock] "Hyundai Department Store, Zinus Now a Star Performer... Target Price Maintained"

Growth of Large Stores Led by Luxury Goods and Food
Jinus Expected to Contribute to Consolidated Performance Defense
Stock Price Not Burdensome Based on 2025 Expected Results

LS Securities maintained a 'Buy' investment rating and a target price of 70,000 KRW for Hyundai Department Store on the 17th. All business sectors are equipped with factors to defend performance, leading to a favorable outlook for 2025 results. In particular, the contribution of Jinus's performance was highly evaluated. Hyundai Department Store's closing price on the previous trading day was 48,000 KRW.

According to LS Securities, Hyundai Department Store's Q4 2024 performance is estimated at consolidated sales of 2.7434 trillion KRW and operating profit of 100 billion KRW, representing increases of 0.2% and 4.4% respectively compared to the same period last year. This generally meets market expectations.

The same-store sales growth rate for department stores is estimated at 0.1?0.2%, with stable growth continuing at major large stores centered on luxury goods and food. However, some sluggish trends were observed due to the warm weather. Efficiency improvements of non-core assets, including the closure of D-Cube City in June this year, are also underway.

Duty-free store sales in Q4 are expected to decrease by 2.7% year-on-year to 228 billion KRW, with an operating loss of 9.8 billion KRW. Despite unfavorable conditions such as a high exchange rate and heavy reliance on large sales volumes, airport duty-free stores recorded relatively good performance compared to the industry average. In particular, average daily sales in December increased to 6.1 billion KRW, positively influenced by the year-end rise in the proportion of FIT (Free Independent Travelers) and the expansion of online sales. Duty-free business sales in 2025 are projected at 956.4 billion KRW, with an operating loss of 28 billion KRW.

Especially, Jinus is expected to record an operating profit of 15.6 billion KRW in Q4 due to the normalization of direct purchase orders from clients and strong sales of small boxes. The resolution of accumulated inventory and improvements in logistics costs also had a positive effect, with an annual operating profit of 51.1 billion KRW expected in 2025. Jinus's performance improvement is anticipated to significantly contribute to defending Hyundai Department Store's consolidated results.

Orin Ah, a researcher at LS Securities, stated, "Despite the overall sluggish consumption environment, all business sectors including department stores, duty-free shops, and Jinus have factors to defend performance, so relatively favorable results are expected within the industry," adding, "The current stock price is not burdensome based on the expected 2025 performance."

This content was produced with the assistance of AI translation services.