[Click eStock] "Shinsegae Sees Rising Foreign Spending at Myeong-dong Flagship... Strong Performance Expected This Year"

iM Securities Initiates Coverage of Shinsegae with Target Price of 680,000 Won
"Flagship Store Reinvented as Luxury Consumption Hub... Benefiting Significantly"

On September 8, iM Securities initiated coverage of Shinsegae, stating that its flagship department store in Myeong-dong is absorbing inbound (overseas visitors' domestic travel) spending. The firm set a target price of 6.8 million won with a "Buy" investment rating.

According to iM Securities' estimates, Shinsegae's sales for this year will reach 7.2342 trillion won, up 4.4% year-on-year, with operating profit projected at 822.1 billion won, an increase of 71.3%. For the department store segment, sales are forecast at 22.4 billion won (up 13.0%), and operating profit at 559.3 billion won (up 37.7%), indicating robust growth. Jang Ho, a researcher at iM Securities, stated, "This is driven by concentrated inbound spending around the flagship store, and given the size and location of the store, there is high visibility for sales growth as premium consumption expands."

Its subsidiary, Shinsegae Central, is expected to post an operating profit of 108.6 billion won (up 37.7%) due to strong rental income at the Gangnam branch and the strong performance of Marriott Hotel Seocho during peak season. Shinsegae International, representing the fashion segment, is expected to see a turnaround in its results, while Shinsegae DF is also expected to improve margins following its withdrawal from Incheon Airport DF2.

iM Securities particularly highlighted this year's performance at the Shinsegae flagship store located in Myeong-dong, Jung-gu, Seoul. In the second quarter, average monthly tourist spending reached 2.1 trillion won, up 59.6% year-on-year, with department stores being a major channel that absorbs the expanding inbound spending.

Researcher Jang stated, "The concentration of demand for K-shopping is especially overwhelming in Myeong-dong, and the scale of benefits for the Shinsegae flagship store is especially significant." He also noted, "Following a renovation completed early this year, the store has been reborn as a luxury consumption-focused location, and initiatives such as establishing duty-free shops and digital signage have significantly increased foot traffic." iM Securities forecasts that foreign net sales at the Myeong-dong flagship store will increase by 94.8% year-on-year in 2026.

This content was produced with the assistance of AI translation services.