[Click e-Stock] "NH Investment & Securities Expected to See 30% Net Profit Growth This Year Thanks to Strong Market... Target Price Raised"

Target Price Raised by 16% Compared to Previous Estimate

On July 10, Korea Investment & Securities raised its target price for NH Investment & Securities from 21,500 won to 25,000 won, projecting that this year's net profit will increase by 30%. The investment opinion was maintained as 'Buy'.

Baek Doosan, a researcher at Korea Investment & Securities, stated, "We expect this year's net profit to increase by 30% due to favorable market conditions, and the situation highlights a high shareholder return rate exceeding 50%, which is also positive." He added, "The expected dividend yield for 2025 is 5.5%, and the shareholder return yield is 6.4%."

NH Investment & Securities' second-quarter results this year are expected to exceed market expectations. Baek explained, "Second-quarter controlling net profit is projected to be 243.3 billion won, which is 25% higher than the consensus (the average forecast of securities firms)," and "this reflects the stronger-than-expected performance in investment banking (IB) and operating profit."

Brokerage fees are expected to reach 138.9 billion won, up 18% from the previous quarter, while interest income related to credit business is projected to increase by 8% to 82.5 billion won. Baek noted, "The increase in brokerage fees reflects higher earnings mainly from domestic stocks," adding, "Both the average balance of securities credit and deposits are steadily increasing."

IB fees are forecasted to rise by 20% from the previous quarter to 129.1 billion won. Baek stated, "It is estimated that earnings related to real estate project financing (PF) have been recognized steadily." He continued, "Operating profit and interest income are projected to reach 292.9 billion won, a 48% increase from the previous quarter, as both stock and bond management results are estimated to be strong due to the rise in stock indices and the decline in interest rates."

Strong results are also expected in the third quarter. Baek explained, "Considering the recent stock market trends, we expect robust performance in the third quarter as well, mainly driven by brokerage fees, interest income from credit business, and operating profit."