[Edaily Reporter Kwon Oh Seok ] NH INVESTMENT & SECURITIES announced on the 4th that it is maintaining its “Buy” rating on HandsomeCorporation(020000)but lowering its target price from 34,000 won to 25,000 won.

Jeong Ji-yoon, an analyst at NH INVESTMENT & SECURITIES, noted, “Along with the stock market correction in June, consumer sentiment contracted somewhat, causing HandsomeCorporation’s sales growth to slow temporarily.” However, she added, “As of July, sales of women’s apparel and Namsung clothing are showing signs of recovery, once again growing at a mid-single-digit rate (4–6%) year-over-year. Concerns about excessive earnings declines in the second half of the year are unfounded.”
HandsomeCorporation’s second-quarter consolidated revenue was 363.2 billion won (up 7% year-over-year), and operating profit was 4.6 billion won (up 525%). While revenue met consensus estimates, operating profit fell 60% short of expectations. He analyzed, “In the second quarter, the average sales growth rate for the domestic department store fashion category was +12% for women’s suits, +19% for casual wear, and +10% for Namsung apparel, indicating a strong market performance,” adding, “While double-digit sales growth continued through May, the growth rate slowed as department store channel sales remained flat in June.”
The gross profit margin stood at 53.7% (-0.9 percentage points), and the operating profit margin was 1.3% (+1.1 percentage points). Researcher Jeong noted, “HandsomeCorporation has been actively expanding its imported brand portfolio since 2022, but gross profit fell short of expectations due to higher discount rates aimed at clearing out inventory of older imported brands.” He added, “As a result, inventory assets decreased by 8% at the end of the first half, and since a significant portion of the inventory from the second quarter—which saw strong sales growth—was cleared out, the situation is expected to ease in the second half.”