[Click e-Stock] "Amorepacific Expected to Grow Through Brand Channel Expansion"

On July 1, Kiwoom Securities raised its target price for Amorepacific from 170,000 won to 180,000 won, citing increased growth potential as brands such as Laneige, as well as Aestura and Hanyul, are entering Western channels. The investment opinion of 'Buy' was maintained.

Amorepacific's second-quarter sales are expected to reach 981.7 billion won (+8% year-on-year), with operating profit at 75.3 billion won (+1693%), in line with market expectations. Sales from the Chinese subsidiary, which recorded a loss last year, are projected to achieve double-digit growth thanks to a low base effect. Additionally, operating profit is expected to turn positive, supported by ongoing cost-cutting efforts.

Jo Sojeong, an analyst at Kiwoom Securities, stated, "Laneige has been the brand leading the growth of overseas channels, and recently, brands such as Aestura and Hanyul have also begun to make their entry into Western channels." She added, "The performance of these brands is expected to serve as an additional growth driver for future earnings." Based on Laneige's solid growth momentum, North American sales in the second quarter are projected to reach 97.7 billion won (+15%), while EMEA (Europe, Middle East, and Africa) sales are expected to be 24.6 billion won (+30%). However, due to increased marketing investments, Jo analyzed that the operating profit margin (OPM) will remain in the 5% range.