[Click e-Stock] "Clio Expanding Global Contribution... Target Price Raised"

Hyundai Motor Securities Sets Target Price at 17,000 Won

On September 9, Hyundai Motor Securities raised its target price for Clio from 14,000 won to 17,000 won and maintained its 'buy' investment opinion.

Heeji Ha, an analyst at Hyundai Motor Securities, said, "As Clio strengthens its domestic low-margin channel structure and improves profitability in the H&B channel, the company is expected to maintain solid profitability focused on the domestic market. It is also positive that its contributions in the U.S. and Greater China markets are expanding."

In the second quarter of this year, Clio posted sales of 86.8 billion won, up 5.7% year-on-year, and operating profit of 11.6 billion won, representing growth of 230.1%. In Korea, the H&B channel in particular led growth, driven by strong sales of new color cosmetics and Goodal sun care products. Analyst Ha remarked that "Profitability was mainly improved by cost reductions from a decreased proportion of large-scale H&B collaborations and an improved commission rate from scaling down low-profit channels such as home shopping and Daiso, which contributed significantly to profit improvements."

Overseas sales increased by 12% year-on-year. North America saw the strongest growth at 57% over the same period. "The contribution of Clio’s eye category is particularly expanding," said Analyst Ha, "and Amazon sales in the second quarter reached approximately 5 billion won, which is positive. For the second half, there are expectations for offline retail channel entry at retailers such as Costco and Nordstrom."

Third-quarter sales are forecast to reach 87.7 billion won, with operating profit of 7.3 billion won. Regarding the domestic market, Analyst Ha explained, "With growth continuing around online vertical platforms, sales are expected to climb 24% compared to the same period last year. In the third quarter as well, the effects of scaling back large promotions in the H&B channel and streamlining inefficient channels will become more apparent, allowing for sustainable solid profitability."

For overseas markets, he predicted, "In the third quarter, North American sales may fall short of expectations due to the absence of Amazon events, and with major offline channel entries also concentrated in the fourth quarter, some recalibration will be necessary. In Japan, the effect of organizational restructuring is expected to persist, leading to a decline in sales in the third quarter."

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