Hana Securities projected on August 26 that Samyang Foods will maintain its long-term growth trajectory, supported by regional diversification and the operation of a new factory in China. The firm reiterated its 'buy' rating and set a target price of 1.8 million won.
Analyst Shim Eun-joo stated, "Samyang Foods has significant expansion potential in the long term due to its regional diversification."
In the second quarter, Samyang Foods reported consolidated sales of 770.3 billion won, a 39.3% increase from the same period last year, while operating profit rose 46.7% to 176.2 billion won. Overseas sales reached 645.8 billion won, also up 46.7%. Sales in the U.S. and China surged by 54.2% and 44.1%, respectively, driving growth, and exports to Europe exceeded 100 billion won for the first time on a quarterly basis.
Shim noted that Europe has the potential to surpass the U.S. and China in terms of expansion, considering its penetration rate and growth potential. The annual per capita consumption of ramen in major European countries is about four, significantly lower than the approximately 13 in the U.S. and South American countries, indicating substantial room for growth.
The new factory in China is also seen as a growth driver. With a production capacity of 1.13 billion units, the factory is expected to begin operations early next year. Once local production in China ramps up, the excess capacity at the Miryang plant could be utilized to expand into the U.S. and European markets.
Hana Securities forecasts that Samyang Foods' consolidated sales for the third quarter will increase by 28.4% year-on-year to 811.4 billion won, with operating profit expected to rise by 43.2% to 187.5 billion won. Shim remarked, "Consumer preference for the Buldak brand remains strong."
* This article has been translated by AI.
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