April 25, 2024

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[THE INVESTOR] Chongkundang Pharmaceutical shares are trading at a 20 percent discount on the average price-earnings ratio and will improve after it exports its technology, said KTB Investment and Securities on May 24, raising the target price to 140,000 won (US$124.28) from 130,000 won and maintaining a “buy” recommendation. 

The pharmaceutical firm has two to three R&D projects in the pipeline that have finished the first stage of global clinical trials, noted analyst Lee Hye-rin. But it is still heavily dependent on the domestic market with less than 10 percent of its revenue from exports, and its earnings are susceptible to regulation changes, added the analyst.

Its first-quarter revenue rose 3.8 percent on-year to 209.7 billion won despite the decline in sales of Tamiflu, from 22.1 billion won in Q1 2016 to 6.9 billion won, according to Lee estimating that its revenue and operating profit in the second quarter will reach 216.6 billion won and 15.5 billion won, up 5.3 percent and 46.7 percent on-year, respectively.

By Hwang You-mee (glamazon@heraldcorp.com)