[Edaily Reporter Kwon Oh Seok ] NH INVESTMENT & SECURITIES announced on the 2nd that it is maintaining its “Buy” investment rating and target price of 34,000 won for GS Retail(007070).

Joo Young-hoon, an analyst at NH INVESTMENT & SECURITIES, stated, “The key investment point is a revaluation driven by the normalization of earnings in the non-convenience store business segment,” adding, “Over the past few years, the high earnings volatility in the non-convenience store segment made it difficult to properly assess the value of the core convenience store business, and this has acted as a factor discounting the company’s valuation.”
He noted, “In the first half of the year, all non-convenience store business segments—including supermarkets, home shopping, and other businesses—showed a stable trend of earnings improvement, and these strengths are expected to be highlighted in the third quarter as well.”
He further explained, “While sales growth in the core convenience store business is expected to slow temporarily due to the base effect from the ‘Livelihood Recovery Consumption Coupons’ distributed in the same period last year, we anticipate that the trend of year-over-year growth in consolidated operating profit will continue, driven by the improved performance of the non-convenience store business segments.” The current stock price trades at a P/E ratio of just 9.4 times based on 2026 estimates, making it highly attractive from a valuation perspective.
The firm projected third-quarter consolidated revenue and operating profit at 3.3406 trillion won (+4.2% year-over-year) and 117.4 billion won (+5.6%), respectively. The lead analyst stated, “We estimate the same-store growth rate for convenience stores to be around +2.0%. Although sales trends through August were somewhat sluggish due to the base effect, we believe they have begun to recover as of September.”
He added, “The impact of the livelihood recovery consumption coupons will be partially reflected in the fourth quarter as well; since the scale of this impact is relatively small, we expect the revenue growth rate to expand further,” and noted, “Supermarkets are expected to perform well, recording double-digit same-store growth rates.”
He continued, “Unlike convenience stores, supermarkets face a relatively low base effect related to the ‘Livelihood Recovery’ consumption coupons, and they are expected to benefit from the deteriorating business environment of competitors as well as the positive impact of Chuseok falling earlier this year compared to last year.” He also noted, “Home shopping is also continuing its stable year-over-year profit improvement trend.”