Report

Innocean Worldwide (214320.KS): D&G effect and growing expectations

  • -  We believe Innocean’s earnings and stock performance in 2018 will be weak in 1H and strong in 2H. As we head into the year-end, captive clients’ new model launches are expected to fuel marketing demand. The recently acquired D&G and the World Cup in Russia in June are likely to add to momentum.

  • -  The earnings from D&G, a US-based creative agency representing Kia Motors America, will be fully recognized from 1Q18, and will have the effect of boosting annual gross profit by KRW50bn. Beginning with the establishment of Canvas Worldwide in 2016, the vertical integration of creative work, digital analysis, and media buying is expected to be a growth driver for the North American business.

Underlying
Innocean Worldwide

INNOCEAN WORLDWIDE INC. is a Korea-based company principally engaged in providing integrated services on marketing and communication industries. The company mainly provides domestic media agency services and overseas media agency services. The company also provides services such as advertising production, promotion, outdoor advertising, sports business consulting, space design, and experience marketing.

Provider
Hyundai Motor Investment & Securities
Hyundai Motor Investment & Securities

Hyundai Motor Investment & Securities is the investment banking arm of the Hyundai Motor Group. The company offers stock brokerage and advisory services; derivative products brokerage and advisory services; wrap account portfolio management services; and VIP wealth management and tax planning, institutional equities, derivatives, and futures brokerage services, as well as sells investment and institutional products. It also provides equity offering, ABS, real estate PF and real estate PF securitization, offshore SOC, structured financing, asset securitization, real estate sales, IPO advisory, and private equity fund and fund management services; and CMA/RP portfolio management and fixed income based investments, as well as involved in the issuance, management, and brokerage of OTC derivatives. In addition, the company offers research services, including macro economic forecasts and stock market outlook, industry overviews and forecasts, fixed income strategies, corporate credit analysis, and valuation analysis. Further, it offers a range of retirement and pension services for individuals and corporate members; portfolios and asset allocation consulting and marketing services; proposing retirement pension plans; contract and payment management services; pension plan advisory and actuarial services; and system development and implementation services, as well as operates call centers for retirement pension services, etc. 

Analysts
Sung Jin Hwang

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