[Edaily Reporter Shin Ha-yeon] #Lotte Shopping is up more than 6% in early trading.
According to MP Doctor on the 9th, as of 9:27 a.m. today, Lotte Shopping is trading at 178,100 won, up 10,500 won (6.26%) from the previous trading day.
This is interpreted as being driven by investor sentiment following optimistic forecasts from the securities industry regarding the performance of the department store division.
Cho Sang-hoon, an analyst at Shinhan Investment Securities, stated in a report released today, “The department store sector continues to show exceptional strength, driven by rising labor income, rising asset prices, and a surge in foreign sales, as well as efforts to renovate key stores and expand overseas operations,” adding, “We maintain our view that it is the top pick in the sector.”
He further explained, “Customer data spanning department stores, supermarkets, and e-commerce, along with offline assets, serve as key differentiators,” adding, “If the RMN (advertising) and AI commerce strategies materialize, a revaluation of the company’s value is possible.”
In the department store sector, in particular, the expansion of inbound sales was identified as the strongest investment point. At Lotte Department Store’s main branch, inbound sales in the first quarter of this year increased by 92% year-over-year, accounting for 23% of total sales.
Researcher Cho analyzed, “In terms of attracting foreign customers, the key differentiators compared to competitors are the exclusive membership card for foreigners, extensive advertising and promotional activities, and merchandising differentiation leveraging K-content.”
On the same day, Korea Investment & Securities also released a report, raising Lotte Shopping’s target price by 15% to 230,000 won.
Kim Myung-ju, an analyst at Korea Investment & Securities, stated, “Lotte Shopping, which has suffered from prolonged slump, will finally see most of its business units—excluding home appliance mass retailers—return to normal starting this year,” adding, “We have slightly raised the applied valuation multiples to reflect this.”
He continued, “The operating profit leverage effect demonstrated by Lotte Shopping’s domestic department store division since the fourth quarter of last year is expected to continue throughout this year,” noting, “As the department store industry enters a phase of structural growth driven by factors such as the wealth effect, not only department stores in the Seoul metropolitan area but also those in regional cities are showing favorable sales trends.”