First Read: Samyang Foods "Q126 OP / NP beat on solid overseas growth" (Buy)

Research evidence excerpt

First Read: Samyang Foods "Q126 OP / NP beat on solid overseas growth" (Buy)

673 69,891 -18 71,920

Q: Has the company's outlook/guidance changed? 12/27E 102,784 91,279 -11 88,291

A: Following strong Q1 results, the company expects solid Q2 sales supported by 1) 12/28E 125,991 105,170 -17 102,528

continued coverage expansion in Europe 2) continuous solid US growth as robust export

Jaehyung Choi

momentum seen in Q1. While mgmt plans to increase marketing spending in Q2 around

Analyst

world cup related promotions and Costco events, profits are expected to remain solid on jaehyung.choi@ubs.com

continued volume growth. In China, the snack retail channel continues to grow steadily, +82-2-3702 8172

and management believes the company can comfortably achieve current full year

Juseong Lee

consensus expectations. The China plant is also scheduled to begin initial operations by

the end of this year. The market had been concerned that a slowdown in US demand, juseong.lee@ubs.com

combined with increasing China volume, could lead to unfavourable mix deterioration. +82-2-3702 8106

However, we believe that if EU can offset the slowdown in the US, the overall mix could

Rei Ihara

remain stable. Analyst

rei.ihara@ubs.com

Valuation: Our new PT of Won1,600K based on 17.5x P/E 2027E EPS +81-3-5208 6227

As we previously assumed a stronger pace of US channel expansion than what is

currently materializing, we are lowering 2026/27E OP estimates by 18%/11%

respectively. Our new PT of 1,600K is based on 1) 17.5x of target P/E which is 2H24-

2025 upcycle average (Previous: 20x P/E) 2) roll forward valuation base to 2027E from

2026-27E average. We expect near term earnings momentum to continue, but believe a

return to last year's peak multiple of 20x will be difficult given slower overseas sales