[Edaily Reporter Hyera Lee ] On the 22nd, Hana Securities stated regarding CJ CheilJedang Corp(097950), “Given the potential for upward momentum in second-half earnings, now is an appropriate time to take a ‘Buy’ position,” and maintained its ‘Buy’ investment rating and target price of 370,000 won.

Shim Eun-ju, an analyst at Hana Securities, stated in a report released that day, “With the improving biotech market conditions and the low base effect converging, a meaningful year-over-year increase in profits is expected in the second half of the year.”
There are two key investment points.
Analyst Shim expects the food division to continue its robust growth. She noted, “Domestic processed food sales are projected to increase by approximately 5% year-over-year, driven by strong sales of Bibigo and Haetban,” adding, “Overseas processed food sales are also expected to rise by about 9%, supported by favorable exchange rates in the Americas and growth in Europe and the APAC region.”
However, he predicted that the increase in profitability would not be significant. Analyst Shim said, “Profitability will slow slightly due to increased marketing expenses for global brand expansion.”
He also highlighted the pace of recovery in the biotech division. Analyst Shim predicted, “Operating profit for the biotech division is expected to improve from 5.5 billion won in the first quarter to approximately 60 billion won in the second quarter, and reach around 80 billion won per quarter in the second half of the year.”
He remarked, “Higher amino acid selling prices driven by rising soybean meal costs and anti-dumping duties on Chinese lysine in North America will drive earnings improvement,” adding, “We should also consider the possibility of increased sales of lysine and nucleic acids due to windfall gains from supply disruptions of methionine among competitors and the recovery in pork consumption in China.”
Hana Securities projected that CJ CheilJedang Corp.’s second-quarter earnings would meet market expectations. Hana Securities estimated consolidated revenue at 6.952 trillion won (-3.9%) and operating profit at 270.7 billion won (-23.4%).
Analyst Shim assessed, “The recovery in the bio business’s performance is proceeding faster than expected, and the current stock price is undervalued at a 12-month forward P/E ratio of 6.5 times.”