Kolon Industries’ commercial production of CPI this year has faced a setback, said KB Investment and Securities on Feb.2 0 lowering the target price to 68,000 won (US$60.62) from 72,000 won.
Its revenue in the fourth quarter last year rose 6.5 percent on-year to 1.33 trillion won but operating profit dropped 39.5 percent to 31.5 billion won below market expectations. The size of industrial material sector has grown in the period but one-off costs and bringing in high priced raw materials have undermined profits. Improved revenue from individual industrial material divisions as well as from Vietnamese branch and Kolon Glotech, however, is a plus, said analyst Baek Yeong-chan.
Its revenue in the first half of this year will rise 1.9 percent on-year to 1.15 trillion won and operating profit by 8.3 percent to 41.0 billion won, he estimated, maintaining a “buy” recommendation.
By Hwang You-mee (firstname.lastname@example.org)