[Click eStock] "NH Investment & Securities, Stable Performance Centered on IB"

On the 11th, Korea Investment & Securities forecasted that NH Investment & Securities' first-quarter net profit would meet consensus expectations, with particularly strong performance expected to continue in the IB division. They maintained a 'Buy' rating and a target price of 18,000 KRW.

Korea Investment & Securities projected that NH Investment & Securities' first-quarter net income attributable to controlling shareholders, based on consolidated financial statements, would be 196.7 billion KRW, in line with consensus. This represents only a 1% downward revision from previous estimates. Although operating profit and net interest income were weaker than expected, fee income remained robust.

By business segment, brokerage commission income is expected to be 121.7 billion KRW, an 8% increase compared to the previous quarter. This was due to increased domestic stock commission income despite a decline in overseas stock commission income. Financial product sales commission income is expected to remain steady at 22.2 billion KRW, similar to the previous quarter.

In particular, IB commission income is forecasted at 96.9 billion KRW, a 9% decrease from the previous quarter but an 18% increase year-over-year. Analyst Baek Doosan commented, "Sustained strong IB performance is ongoing, based on differentiated IB competitiveness." Interest income related to loans is expected to be 75.2 billion KRW, a 3% increase from the previous quarter. Meanwhile, operating profit and net interest income are expected to remain at 215.2 billion KRW, unchanged from the previous quarter but down 7% year-over-year.

He analyzed, "Despite increased market volatility, it is positive that performance remains stable, centered on the core competency of IB. However, improvements in operating profit performance and SG&A efficiency are needed to further increase return on equity (ROE)."