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THE INVESTOR
April 09, 2020
Big Reunion

Stocks & Bonds

[EQUITIES] ‘Hyundai’s duty-free biz off to a good start’

  • PUBLISHED :November 22, 2018 - 10:25
  • UPDATED :November 22, 2018 - 10:25
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[THE INVESTOR] Hyundai Department Store Group’s duty-free business is operating smoothly since its launch, said NH Investment and Securities on Nov. 22 maintaining a “buy” recommendation and 135,000 won (US$119.60) target price. 




The outlet which opened in southern Seoul on Nov. 1 is logging 1 billion won in daily revenue as of now, and is likely to reach 60 billion won in gross revenue this year. As many global luxury brands are not yet available with only 80 percent of boutiques filled, revenue is likely to expand. As for commission rate, the retail heavyweight is keeping in line with existing duty-free stores in the area. Considering that the market is dominated by major operators with strong sales capacity this signifies that Hyundai is focusing on profitability rather than competing excessively, said analyst Lee Ji-yeong.

Its current stock price is at 9.5 times its price-earnings ratio, low in the industry. It has been undervalued for constraining itself to conventional department store business but the duty-free sector will serve as its growth momentum, especially as inbound tourism from China is likely to recover from next year, noted the analyst.

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

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