[Click e-Stock] "Kolmar Korea, U.S. Business Momentum Remains Valid... Target Price Up"

Target Price Raised from 73,000 Won to 90,000 Won

On April 25, LS Securities raised its target price for Kolmar Korea from 73,000 won to 90,000 won, citing sustained momentum in its U.S. business and expectations for the peak season in sun care. The investment rating was maintained at 'Buy'.

Oh Rina, a researcher at LS Securities, stated, "The upward revision of the target price is due to higher estimates," adding, "With the arrival of the sun cream peak season, the company's performance is expected to accelerate further in the second quarter."

Kolmar Korea's first-quarter results for this year are expected to be solid. Researcher Oh said, "On a consolidated basis, first-quarter sales are projected to reach 648.1 billion won, up 12.8% year-on-year, and operating profit is expected to increase by 54.8% to 50.2 billion won, exceeding previous estimates by 5.6%." She added, "The domestic subsidiary is expected to see sales rise by 13.8% to 281.9 billion won, driven by stable orders from existing clients and continued inflow of new clients, with an estimated operating margin of 10.5%." For the China subsidiary, although demand for sun care products from major clients has recovered, delayed recovery from other clients is expected to result in first-quarter sales declining by 2.8% to 38 billion won, with operating profit estimated at around 1.5 billion won. The U.S. subsidiary is projected to achieve sales of 17.5 billion won, representing 150% growth, and to return to profitability with an operating profit of 700 million won. Oh also analyzed, "HK Innoen is expected to post results above consensus (the average of securities firms' forecasts) thanks to solid growth in K-Cab prescriptions and robust sales of new oncology products, which will have a positive impact on consolidated results."

There is an opinion that the momentum in the U.S. business remains strong. Oh explained, "This year, North American sales are expected to increase by 47% year-on-year to 85.3 billion won, with profitability also turning positive." She added, "The second U.S. plant, scheduled to begin operations between April and May this year, is expected to generate annual sales of about 60 billion won. With automation facilities at the level of those in Korea, early profitability is likely to be achieved." She continued, "Changes in U.S. tariff policy are leading to increased local production demand from clients, which will benefit Kolmar Korea. Additionally, consumer stockpiling of locally produced sun care products due to tariffs is also positive for the company."