[Click eStock] "HiteJinro, Profitability Improvement Expected Through Significant Cost Reduction"

DS Investment & Securities expected Hite Jinro to improve profitability this year through significant cost reductions. The buy rating and target price of 28,000 KRW were maintained.

Hite Jinro recorded annual sales of 2.5992 trillion KRW and operating profit of 208.1 billion KRW last year, representing increases of 3% and 68% respectively compared to the previous year.

DS Investment & Securities forecasted Hite Jinro's performance this year with sales of 2.6392 trillion KRW and operating profit of 229.4 billion KRW.

Jang Ji-hye, a researcher at DS Investment & Securities, explained, "Although external growth is limited due to changes in drinking culture and sluggish domestic consumption, profitability improvement is expected in 2025 due to market share expansion centered on soju, efficiency in selling and administrative expenses, and the base effect of one-time costs incurred last year."

Particularly, attention was paid to growth in overseas markets. Last year, Hite Jinro's export sales of soju and other alcoholic beverages reached 153.4 billion KRW, a 10% increase from the previous year, and the proportion expanded to 11%.

Researcher Jang said, "This year, marketing will be strengthened in major overseas countries including Japan, China, the United States, and Vietnam to continue growth in overseas performance," adding, "The first overseas production plant under construction in Vietnam is expected to be completed in 2026 and begin full-scale operation in 2027, driving growth in overseas performance."