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[Alpha Biz= Paul Lee] SangSangIn Securities analyzed on the 5th that Hugel's revenue will grow this year, driven by increased exports of both botulinum toxin (Botox) and fillers. The firm raised its target price from 400,000 KRW to 440,000 KRW while maintaining a "Buy" rating.
SangSangIn Securities expects Hugel’s Botox to expand into the U.S. market, alongside increased exports of fillers and cosmetics. The company plans to officially launch its Botox product in the U.S. through its local partner, Benev, in the first half of this year. Analyst Ha explained, “Since Benev will cover the marketing expenses, Hugel’s profit margins will be favorable.”
The firm also noted that Hugel’s FDA approval and official U.S. market entry will enhance its brand image and value, leading to increased sales not only in North America but also in Asia, Europe, and South America in the latter half of the year.
Additionally, synergy between Botox and fillers is expected to drive sales growth. As both products can be bundled into package deals, the expansion of Botox exports is likely to boost filler sales as well.
SangSangIn Securities anticipates further improvements in profitability following last year’s significant gains. “In 2023, operating profit margin improved by 7.7 percentage points year-over-year to 44.6%, thanks to cost control measures and reduced litigation expenses related to the U.S. International Trade Commission (ITC) case. This year, the margin is expected to increase by an additional 4 percentage points to 48.6%,” said Ha.
The firm believes Hugel’s stock price will rise in tandem with its growing Botox exports. “Although the recent rally in Hugel’s stock may create concerns about short-term upside potential, its current estimated PER (Price-to-Earnings Ratio) for this year remains at just 19.7x,” Ha added. “Given the anticipated surge in Botox exports, particularly in the U.S., Hugel’s corporate value is expected to grow significantly, and its stock price should adjust accordingly.”
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
