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Photo = Yonhap news |
[Alpha Biz= Reporter Kim Sangjin] DS Investment Securities predicted on the 19th that Samyang Foods would surpass market expectations for its Q4 earnings, driven primarily by robust export growth. The firm also highlighted the company’s enhanced production capacity as a key factor in securing long-term growth. It maintained a "Buy" rating and raised the target price from KRW 720,000 to KRW 850,000, representing a 20% upside from the current share price of KRW 707,000.
For Q4, DS Investment Securities forecasted consolidated revenue of KRW 448.5 billion, up 37% year-on-year, and operating profit of KRW 87.4 billion, marking a 142% increase. The projected operating profit is expected to exceed the market consensus of KRW 81.1 billion.
The company’s long-term growth potential was attributed to its rapidly increasing global demand and production capacity expansion.
DS Investment Securities stated, “Samyang Foods is well-positioned for sustained performance growth, supported by strong overseas demand and continuous expansion of production capacity.” The firm noted that the new Miryang Plant 2, scheduled for completion in May 2025, will commence operations in June or July of the same year, enabling export expansion beyond the U.S. to Canada, Mexico, and Europe.
The firm also highlighted Samyang Foods’ plans to establish its first overseas production facility in China, targeting Q1 2027 for operations. This plant, aimed at producing products for the Chinese domestic market, will feature six production lines, mirroring the scale of the Miryang Plant 2, with an estimated investment of KRW 201.4 billion.
Despite recent stock price gains, DS Investment Securities maintained that there is still room for further growth. “Considering the company’s earnings growth, its relative valuation remains attractive. While there are short-term concerns about rapid share price increases, we maintain Samyang Foods as our top pick in the sector,” the firm concluded.
AlphaBIZ Kim SangJin(letyou@alphabiz.co.kr)
