The combined worth of Maeil
and its holding company after its spin-off will raise its market value by 20 percent, said Shinhan Financial Investment on April 20, raising the target price to 60,000 won (US$52.70) from 50,000 won.
The dairy company’s stock price is likely to rise following the relisting, forecast analyst O Gyeong-seok.
To be eligible for a holding company, Maeil Holdings will begin to increase its stake, according to the analyst. “Maeil Dairy now owns 7.6 percent stake and will increase it to 20 percent, through a tender offer and cash investment, which will prop up its value,” said O.
The company’s operating profit in the first half will rise 44.2 percent to 24.6 billion won and revenue by 4.5 percent to 836.2 billion won on-year, estimated the analyst.
The fall in raw milk price will boost profits throughout the first half, and instead of loss-making white milk, higher-margin items such as organic products and coffee-based drinks will lift its bottom line, he added.
By Hwang You-mee (email@example.com