April 26, 2024

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[THE INVESTOR] Orion’s second-quarter earnings will suffer heavily from China’s retaliatory actions over the THAAD row, said IBK Securities on June 16, maintaining a “hold” recommendation. The securities firm did not suggest a target price.

The confectionary company’s revenue will fall 13.9 percent on-year to 427.3 billion won (US$376.88 million) in the period and operating profit by 26.6 percent to 20.5 billion won, estimated analyst Kim Tae-hyeon. Despite the strong sales at home and in Vietnam and Russia, loss from China, estimated to reach 11.7 billion won, will result in a large drop in earnings, said the analyst.

Its Chinese operation is slowly but steadily recovering and if the tendency continues, could return to normal in August or September, forecast Kim. “However, the THAAD issue has not been solved fundamentally and the situation could worsen,” cautioned the analyst. 

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