LG H&H Strong Q2 but H2 headwinds remain

研报英文原文证据摘录

LG H&H Strong Q2 but H2 headwinds remain

Global Research

30 July 2026ab

LG H&H Equities

KoreaStrong Q2 but H2 headwinds remain

Cosmetics

12-month rating Neutral

Maintain Neutral despite improving Beauty profitability

We maintain our Neutral rating on LGHH. We view the turnaround in Beauty profitability 12m price target Won290,000

positively, supported by improving duty free margins post restructuring and strong

N.America growth led by Dr. Groot brand. However, looking into 2H26, N.America

Price (29 Jul 2026) Won263,000

revenue growth should slow against a higher base from Costco rollout in 2H25 and diff

timing of Amazon Prime Day. Marketing cost is likely to increase in both N.America RIC: 051900.KS BBG: 051900 KS

(Sephora expansion) and China (Cheongidan 3rd gen launch, Singles Day) while rising

Trading data and key metrics

raw material cost is likely to weigh on profitability across all divisions in Q3.

52-wk range Won321,500-215,000

Q226 Review: Op profit beat consensus on strong N.America growth Market cap. Won3,856b/US$2.65b

Shares o/s 14.7m (ORD)

Q2 revenue of Won1.66tr (+3% YoY) and OP Won103bn (+88% YoY) beat consensus

Free float 60%

by 6% and 35% (15% excl. one-off tariff refund), respectively, driven by strong growth

in N.America (+47% YoY), an improved premium product mix, and turn around in duty Avg. daily volume ('000) 69.5

free margins. By segment: Avg. daily value (m) Won17,543.9

Common s/h equity (12/26E) Won5598b

Beauty revenue +4% YoY, OP turned +ve YoY. By channel, DFS fell >20% YoY but P/BV (12/26E) 0.7x

sales decline narrowed QoQ as non-core SKU sales normalized and FIT demand Net debt to EBITDA (12/26E) NM

improved. Online/MBS sales grew DD driven by Dominas and Physiogel. N.America

revenue +47% with Dr.