Hotel Shilla’s earnings prospects are promising, said NH Investment and Securities on Oct. 17 maintaining a “buy” recommendation and 160,000 won (US$142.39) target price.
Its revenue in the third quarter will hike 20 percent on-year to 1.28 trillion won and operating profit will surge 127 percent to 68.9 billion won, satisfying market expectations. Although its rival will open a new duty-free store in November, the existing top three operators will continue to focus on profitability for the time being. Even when commission competition does deepen it will be limited to less popular products and certain resellers, said analyst Lee Ji-yeong.
Inbound tourism from China has been steadily recovering and its business will remain solid starting the fourth quarter, she added.