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Photo = Yonhap news |
[Alpha Biz= Kim Sangjin] On Friday, IBK Investment & Securities reaffirmed its 'Buy' rating on Samyang Foods, citing that the 80% valuation premium compared to the industry average is well justified given the company’s strong growth trajectory. The firm also raised its target price from KRW 760,000 to KRW 1.08 million.
IBK highlighted Samyang Foods' rapid growth in U.S. exports, noting that the Q4 earnings exceeded market expectations. The favorable exchange rate and Walmart’s relocation of instant noodle shelves in October contributed to a 140% YoY increase in U.S. subsidiary sales, reaching KRW 110.4 billion.
Since establishing its U.S. subsidiary in August 2021, Samyang Foods has seen consistent revenue growth. U.S. sales surged from KRW 62.3 billion in 2022 to KRW 378.6 billion in 2023.
Looking ahead, IBK expects 2024 U.S. revenue to exceed KRW 600 billion, driven by increased production capacity and expanded distribution through Walmart, Costco, Target, and Sam’s Club.
Despite the stock’s rapid rise, IBK remains optimistic, forecasting that the overseas sales ratio—80% in 2023—will rise to 87% once the second factory reaches full capacity and exceed 90% following the construction of a new plant in China. The firm sees no major risk factors at this time, considering export data, facility investments, raw material costs, and USD/KRW exchange rate trends.
AlphaBIZ Kim SangJin(letyou@alphabiz.co.kr)
