An exterior view of Kolmar Korea's integrated research and technology center. [Kolmar Korea]
An exterior view of Kolmar Korea's integrated research and technology center. [Kolmar Korea]

Kolmar Korea, the country's leading cosmetics original development manufacturer, is winning fresh attention from the market as the K-beauty export boom shows no signs of slowing. Analysts say the company's business portfolio closely mirrors the structure of South Korea's cosmetics exports — a structural alignment fueling expectations of stronger earnings ahead.

Brokerages forecast Kolmar Korea will post consolidated second-quarter sales of 831.8 billion won ($561 million) and operating profit of 90.3 billion won, up 13.8 percent and 22.9 percent, respectively, from the same period last year. The earnings optimism has already fed through to the share price: the stock hit an all-time intraday high of 123,000 won on July 2. Mirae Asset Securities and Eugene Investment & Securities have raised their price targets to as high as 140,000 won.

Analysts attribute the upbeat outlook to Kolmar Korea's portfolio, which closely tracks the composition of South Korea's cosmetics exports. The Ministry of Food and Drug Safety said domestic cosmetics exports reached $7 billion in the first half of this year, up 27.3 percent from a year earlier. Skincare products accounted for $5.48 billion of that total — 74.7 percent — while color cosmetics held only a 13.2 percent share.

Kolmar Korea's revenue mix tells a similar story: skincare and sun care products account for 50 percent and 26 percent of sales, respectively, giving the two categories a combined share of 76 percent. Analysts say this structural overlap with South Korea's export-driven product mix is a key factor underpinning the company's earnings growth and share price gains.

Brokerages have been broadly positive about the business structure. SK Securities said the skincare-led export boom is likely to sustain Kolmar Korea's earnings momentum, given the company's heavy weighting toward skincare. The brokerage added that orders for both sun care and skincare products are growing rapidly, and forecast that growth will outpace seasonal patterns through the third and fourth quarters of this year, extending a trend that began last year.

Shinyoung Securities projected that Kolmar Korea will post a record quarterly operating profit margin, driven by the peak summer sun care season and strong sales of hit skincare products. The brokerage cited rising global demand for key products made for Kolmar Korea's major clients — including The Pure Lab's 345 Relief Cream and Meditherapy's Retinal Skin Booster Serum — as additional drivers of the earnings improvement.

Lee Gyo-seok, an analyst at Shinyoung Securities, pointed to Meditherapy's Retinal Skin Booster Serum, which has broken into the top 100 on Amazon's US beauty rankings, noting that Kolmar Korea handles production. "Even factoring in Black Friday inventory in the second half, the sales growth benefit from major brand clients should continue into the third quarter," he said.

Lee also said additional growth momentum in the US market is in the pipeline. He added that the newly approved use of bemotrizinol — a UV-filtering ingredient — within the US over-the-counter monograph framework is expected to sharply increase orders from domestic indie brands for US-bound sun care products.

DB Securities also raised its price target on Kolmar Korea from 130,000 won to 140,000 won. "We expect the second quarter to mark a record high in earnings, and we place a high value on the profitability improvement from diversified production that now extends beyond the company's traditional strengths into the broader skincare segment," said Heo Je-na, an analyst at DB Securities. "With production market share expanding rapidly amid the strong K-beauty export boom, this is a company that deserves to be revalued," she added.


boo@heraldcorp.com