April 18, 2024
Stocks & Bonds
[EQUITIES] ‘Orion’s China biz drags down earnings’
[THE INVESTOR] Orion’s improvement in earnings will be limited as the Chinese confectionary market remains sluggish, said IBK Securities on Feb. 17, lowering the target price to 930,000 won (US$813.43) from 1.1 million won.
Its earnings in the fourth quarter of last year were decent due to effective cost-cutting and the advanced reflection of its New Year holiday effect, but will be dragged down this year by the sluggish market at home and in China, which accounts for over 80 percent of its income, said analyst Kim Tae-hyeon.
Orion’s Chinese operation is burdened by the negative growth of the confectionary industry and the depreciation of Chinese yuan, while the South Korean market is stuck at the growth rate of below 2 percent, said the analyst.
Kim maintained a “buy” recommendation, however, saying that its mid- to long-term growth momentum is still sound as it will aggressively launch new products and expand its competitiveness at home and abroad by diversifying its sales channels.
By Hwang You-mee (glamazon@heraldcorp.com)
Its earnings in the fourth quarter of last year were decent due to effective cost-cutting and the advanced reflection of its New Year holiday effect, but will be dragged down this year by the sluggish market at home and in China, which accounts for over 80 percent of its income, said analyst Kim Tae-hyeon.
Orion’s Chinese operation is burdened by the negative growth of the confectionary industry and the depreciation of Chinese yuan, while the South Korean market is stuck at the growth rate of below 2 percent, said the analyst.
Kim maintained a “buy” recommendation, however, saying that its mid- to long-term growth momentum is still sound as it will aggressively launch new products and expand its competitiveness at home and abroad by diversifying its sales channels.
By Hwang You-mee (glamazon@heraldcorp.com)
