Nong Shim: Better 1Q26 on rising margins

Research evidence excerpt

Nong Shim: Better 1Q26 on rising margins

Update

May 15, 2026 11:41 AM GMT

Morgan Stanley & Co. International plc, Seoul Branch+MNong Shim | Asia Pacific Kelly H Kim, CFA

Equity Analyst

Better 1Q26 on rising margins Kelly.Kim@morganstanley.comJenna Lee +82 2 399-4837

Jenna.Lee@morganstanley.com +82 2 399-4938

Reaction to earnings

Nong Shim (004370.KS, 004370 KP)

Unchanged Modest upside Largely unchanged

S. Korea Consumer | S. Korea

Impact to our thesis Financial results versus consensus Direction of next 12-month

consensus EPS Stock Rating Equal-weight

Source: Company data, Morgan Stanley Research Industry View In-Line

Price target W440,000

Up/downside to price target (%) 10

NS posted 1Q26 OP of W67bn, above market expectations. Shr price, close (May 15, 2026) W399,000

While the top line was broadly in line with our expectations, 52-WeekSh out, dil,Rangecurr (mn) W579,000-358,5006

OPM expansion was stronger, particularly in the domestic Mkt cap, curr (bn) W2,427 EV, curr (bn) W1,254

segment. Given pricing pressure and rising cost burdens, we Avg daily trading value (bn) W15

expect YoY margin trends to moderate in the coming quarters. Fiscal Year Ending 12/25 12/26e 12/27e 12/28e

EPS (W)** 27,925 34,183 36,711 42,180

Prior EPS (W)** - 32,769 36,471 42,170

Key Takeaways Revenue, net (W bn) 3,514 3,713 3,842 3,942

EBITDA (W bn) 311 356 384 423

Korea - Despite declining volumes, a 6% YoY increase in noodle ASP drove ModelWare net inc (W 170 208 223 257

bn)

domestic OPM expansion of ~110bp YoY. But from 2Q26, ASPs could decline YoY P/E 15.5 11.7 10.9 9.5

due to price cuts. P/BV 0.9 0.8 0.8 0.7

RNOA (%) 8.3 10.3 10.1 11.2

US sales up 4% YoY (2% YoY in USD). Volume fell 3% YoY, but rising ASP (5-6%) ROE (%) 6.4 7.3 7.4 8.1

EV/EBITDA 4.7 3.5 2.9 2.1