[Click e-Stock] "Hugel Announces U.S. Direct Sales, Target Price Raised to 400,000 Won"

On January 19, Kiwoom Securities raised its target price for Hugel from 3.9 million won to 4 million won. This decision follows Hugel's announcement of plans to expand its market share by establishing a direct sales organization for its U.S. operations.

On January 15 (local time), Hugel participated in the J.P. Morgan Healthcare Conference in the United States, presenting in the Asia-Pacific track. The main topics included the presentation of long-term financial goals, the new disclosure of a hybrid distribution channel strategy for the U.S. market, and portfolio expansion. The most significant update was the company’s goal to launch its U.S. direct sales organization starting at the end of 2026.

Shin Minsu, a researcher at Kiwoom Securities, explained, “Hugel is collaborating on its U.S. business with BENEV, a local distributor of medical devices and pharmaceuticals. The plan is to establish a direct sales organization within the local subsidiary, which sits in the middle of the value chain: manufacturing at the Gangneung plant, Hugel America local subsidiary, BENEV, and then delivery to medical professionals.”

He continued, “Direct sales in the U.S. is a major challenge for domestic medical device companies. Sales personnel command high salaries, and aggressive sales efforts are required, resulting in significant labor and marketing costs. This could lead to margin decline risks. Currently, the top two toxin companies in the U.S. are already seeing lower sales growth rates than before, and their sales guidance has been revised downward, indicating a challenging market environment.”

Shin added, “The direct sales organization is expected to become fully operational by the end of 2026, so most of Hugel’s U.S. performance in 2026 will still come from its existing partner, BENEV.”

He also stated, “The company aims to increase its U.S. toxin market share to 5% in 2026, 10% in 2028, and 14% in 2030, while targeting an operating margin for its U.S. subsidiary of over 20% in 2026 and around 40% in 2030. Since these margins are based on U.S. local accounting, they could contribute to even higher profitability in the consolidated financial statements, where the price at which the product is sold to medical professionals-manufactured at the domestic plant-is reflected.”