April 26, 2024

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[THE INVESTOR] AmorePacific’s products remained popular among Chinese customers, despite Beijing’s economic retaliation after Korea decided to deploy US-based THAAD missile defense system, according to media reports on April 18.

Soon after the decision in January, that 19 Korean cosmetics products out of 28 were disqualified by Chinese authorities from import licenses.

The list mostly left out smaller firms and spared Amorepacific’s beauty items. Hower, despite this the Korean beauty giant’s stock price suffered a setback.

“There was no hitch in exporting our products, but our explanations were ignored as everyone was obsessing over THAAD,” said an Amorepacific spokesperson.

KB Securities estimates that Amorepacific China’s sales increased by 28 percent to 346.1 billion won (US$303.06 million) in the first quarter, with expectations that it will rise by 17 percent in the next quarter.

“Although customers at duty-free stores decreased due to the travel ban imposed by Chinese authorities, sales in China are solid due to both product competitiveness and steady demand,” KB Securities analyst Park Shin-ae said in a report.

Amorepacific was ranked No. 7 in the list of the top 100 beauty companies in the world according to the Women’s Wear Daily due to its performance in Chinese and ASEAN markets.

By Song Seung-hyun (ssh@heraldcorp.com)