[Click eStock] "Bioport to Significantly Expand K-Food Presence at US Costco... Entering Phase of Rapid Earnings Growth"

On June 17, SK Securities stated that Bioport has entered a phase of significant earnings growth. The firm maintained a "Buy" investment rating and set a target price of 23,000 won, representing an upside potential of 105% compared to the current share price.

Bioport, established in 2004, is a K-food manufacturer specializing in snacks, beverages, and liquid teas. The company was listed on the KOSDAQ market last month through a merger with a SPAC. Currently, Bioport exports its products to over 30 countries, primarily through Costco, and approximately 50% of its total sales last year came from exports.

Heo Seonjae, a researcher at SK Securities, explained, "The reason to pay attention to Bioport now is that, based on 21 years of supplying to Costco, the company is expected to see full-fledged earnings growth starting in the second half of this year through expansion of products, channels, and regions." In fact, last year, Bioport achieved export sales of approximately 35 billion won with just three hit products (fried squid, citron ginger tea, and pouch beverages). With about 30 new products scheduled for launch this year, expectations for the next hit products are rising.

The company’s core growth strategy lies in a virtuous cycle of "product x channel x region." Bioport plans and develops hit products, then expands them into global markets through strategic distribution channels. Heo analyzed, "The starting point of this structure is the company’s differentiated product planning capabilities, and Costco serves as a leverage point that amplifies these capabilities."

Bioport’s products focus on the localization of "authentic K-food" based on original ingredients, such as fried squid and citron ginger tea. The company’s competitiveness lies in its ability to quickly plan and launch creative products. A notable feature is its collaboration with distributors’ buyers from the prototype stage, which increases the probability of product success. Products scheduled for release this year include bibimbap, japchae, grilled filefish snacks, sweet potato fries, shrimp chips, and watermelon juice (pouch beverage).

Since entering Costco in 2005, Bioport now supplies its products to 665 stores across nine countries, including the United States, and plans to expand to 890 Costco stores in 14 countries by the second half of this year. Heo noted, "The company has consistently met Costco’s stringent supply standards (marketability, quality, delivery reliability, etc.) for over 20 years, and based on this track record, further expansion into various channels and regions is anticipated."

Key regions for channel expansion in the third quarter include Europe (Costco France, Costco Spain, and Germany’s REWE), as well as China (Sam’s Club, 7-Eleven, Lawson). Notably, China’s Sam’s Club has more than double the number of stores, members, and per-store sales compared to Costco China, so a successful entry is expected to deliver a significant earnings surprise.

The earnings outlook is also positive. SK Securities forecasts Bioport’s sales this year at 88.3 billion won, up 21.5% year-on-year, and operating profit at 6.7 billion won, up 28.5% (an operating margin of 7.6%). Although growth in the first half is expected to slow due to one-off burdens such as tariffs following the inauguration of former President Trump at the beginning of the year, strengthened labor compliance at Costco, and listing expenses, Heo stated, "The 10% tariff burden in the second quarter has been reflected in product prices through negotiations with Costco, and labor audits have been completed, so full-fledged earnings growth is expected to begin in the second half."

In 2026, the effects of product, channel, and regional expansion are expected to be fully reflected, with sales projected at 107.4 billion won (up 21.6% year-on-year) and operating profit at 10.3 billion won (up 54.3% year-on-year, with an operating margin of 9.6%).