[Edaily Reporter Kim Kyung-eun ] As the sweltering heat continues with midday temperatures nearing 40 degrees, investor interest in “heatwave-benefiting stocks” remains strong. Interest is spreading not only to air-conditioning appliance manufacturers but also to convenience stores and the power equipment sector, where demand increases during the summer. With mixed fortunes across sectors, some experts point out that a selective investment strategy—focusing on actual performance rather than relying solely on expectations of a heatwave-driven boom—is necessary.

According to MP Doctor on the 6th, as of 10:15 a.m. that day, BGF Retail(282330)was trading at 130,000 won, up 7,700 won (6.30%) from the previous trading day. GS Retail(007070) was also trading at 26,300 won, up 1,500 won (6.05%) from the previous day.

This is interpreted as a result of rapidly rising sales at convenience stores of heat-beating beverages, ice cream, and ice cubes, driven by the ongoing heat wave. Kim Myung-ju, an analyst at Korea Investment & Securities, explained, “Just like last year, the weather continues to be favorable for convenience stores this year as well.”

Yoo Jeong-hyun, an analyst at DaishinSecurities, commented on BGF Retail: “While costs related to the Cargo Workers’ Union strike are expected to be reflected in the second-quarter earnings, resulting in an operating profit growth rate of only 5%, the actual operating profit growth rate—excluding these costs—is projected to be 20%.” He added, “This is because sales of high-margin products, such as beverages, are performing well due to the early heatwave, and margins have improved as a result of store restructuring.”

Previously, the air-conditioning appliance sector reaped significant benefits from the heatwave. From the 29th of last month, when the intense heat began in earnest, through the previous day (the 5th), PASECO CO.LTD(037070)rose 23.1%, and WINIX INC.(044340)rose 29.2%. This reflects expectations that demand for related products—such as air conditioners, fans, and dehumidifiers—will increase.

The power equipment sector also continued to benefit. During the same period, LS ELECTRIC(010120)rose 29.4%, and HD HYUNDAI ELECTRIC(267260)rose 31.7%. This is interpreted as investor sentiment being stimulated by the combination of benefits from the expansion of artificial intelligence (AI) data centers and the heatwave.

In contrast, ice cream and beverage stocks—typically considered major beneficiaries of heat waves—performed poorly. During this period, LOTTE WELLFOOD(280360)fell 0.7%, #LotteChilsungBeverage dropped 0.4%, and Binggrae(005180)rose by only 0.6%. Despite being a seasonal theme, the lack of earnings support suggests that stock prices will continue to trade in a slightly flat range.

In the case of LotteChilsungBeverage, despite revenue growth in the second quarter of this year, operating profit fell by a double-digit percentage due to the burden of rising raw material prices and logistics costs. LotteChilsungBeverage announced yesterday that its consolidated revenue for the second quarter of this year was 1.1129 trillion won, a 2.4% increase compared to the same period last year. During the same period, operating profit fell 10.4% to 55.8 billion won.

Securities firms unanimously lowered their target prices for LotteChilsungBeverage today. HANWHA INVESTMENT & SECURITIES lowered its target price from 120,000 won to 110,000 won, while KYOBOSECURITIESCO.,LTD. lowered its target price from 155,000 won to 125,000 won. Korea Investment & Securities (150,000 won), NH INVESTMENT & SECURITIES (150,000 won), and Shinhan Investment & Securities (145,000 won) also adjusted their target prices downward.

Han Yu-jeong, an analyst at HANWHA INVESTMENT & SECURITIES, commented on LotteChilsungBeverage, stating, “The structural slowdown in the domestic beverage market and cost volatility at overseas subsidiaries are simultaneously weighing on the company.” She added, “While the potential to realize the value of non-operating assets remains valid, it is difficult to expect a valuation re-rating in a period where profit growth potential in the core business is limited.”

Voices of concern are emerging in the securities industry, warning against “blind investment” that disregards fundamentals such as corporate earnings. In particular, it is pointed out that seasonal themes, such as heat waves, tend to cause stock prices to move ahead of the actual season, so caution is needed when investing.

An official in the financial investment industry stated, “Even if stock prices rise due to weather conditions such as heat waves or the rainy season, they often undergo corrections afterward, so investors must be mindful of volatility,” adding, “Without solid business performance and positive outlooks to support them, a sustained upward trend in stock prices cannot be expected.”