Korea Consumer No way out?

Research evidence excerpt

Korea Consumer No way out?

24 June 2026

Korea Consumer EquitiesConsumer

No way out? Korea

◆ Staple names under our coverage underperformed the Karen Choi*

market significantly (y-t-d down 4% vs. the KOSPI up 95%) HeadThe Hongkongof Consumerand Shanghai& Retail Research,Banking CorporationAsia Pacific

Limited, Seoul Securities Branch

◆ We think the weak domestic consumption is more than priced karen.choi@kr.hsbc.com

in the shares; time to revisit some of the laggards +82 2 3706 8781

Sophia Jung*

Associate, Consumer Research

◆ We prefer Samyang Foods (Buy); adjust TPs for five stocks The Hongkong and Shanghai Banking Corporation

on estimate changes Limited,sophia.jung@kr.hsbc.comSeoul Securities Branch

+822 3706 8774

What’s on our mind?

In the current bull market, staple names under our coverage significantly * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

underperformed the market y-t-d (down 4% vs. KOSPI up 95%) – which may not be a

surprise. Domestic consumption, maybe except for luxury, remains sluggish, as

suggested by the monthly retail sales data. Bio-polarisation of spending continues. As

such, we forecast 2Q earnings would unlikely beat consensus expectations, except for

Samyang Foods and KT&G where overseas contribution continues to rise. We believe

weak earnings are more than priced in the shares. We continue to prefer companies

with overseas expansion momentum. See figure 1 for 2Q preview.

We prefer Samyang Foods

Among our staple coverage, we like Samyang Foods (Buy) the most given its long-

term sustainable growth outlook. We think the recent pullback provides enhanced

opportunity to buy, while another factory addition in China is a long-awaited catalyst

for the company.