April 20, 2024

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[THE INVESTOR] Lotte Food’s margins are likely to improve, said NH Investment and Securities on May 23, raising the target price to 850,000 won (US$788.50) from 700,000 won.

Revenue and operating profit this year will reach 1.88 trillion won and 77.1 billion won, respectively. Although revenue will not rise significantly, margins from major business sectors are more likely to advance, said analyst Han Guk-heui.

Its operating profit ratio will recover to 4.1 percent, from last year’s 3.6 percent, bolstered by stable prices of pork and imported oil and fat. In the first quarter it posted 430.8 billion won revenue and 15.9 billion won operating profit, in line with market expectations. The operating profit will continue to rebound and will expand throughout the year on the back of expanding sales of convenience food, she added, maintaining a “buy” recommendation. 

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