Daishin Securities Initiates CJ with Buy Rating and 260,000-Won Target, Spotlighting Olive Young's Value

Daishin Securities Initiates CJ at Buy; Sets 260,000-Won Target Price

Daishin Securities initiated coverage of CJ Corp. (001040) on the 15th with an investment rating of Buy and a target price of 260,000 won.

Analyst Lee Kyung-yeon named CJ as the top pick within the holding-company sector. The target price was derived using a Sum-of-the-Parts (SOTP) valuation with a target discount rate of 55% applied.

Based on the current share price of 201,000 won (as of 1 April), the implied upside is 28.4%.

CJ Olive Young: The Core Investment Case

The central investment thesis rests on the value attribution of CJ Olive Young, an unlisted subsidiary. Olive Young accounts for approximately 60% of total net asset value (NAV), with an estimated enterprise value of around 6.9 trillion won.

Recent regulatory tightening on dual listings—where a subsidiary already represented in a listed parent's valuation seeks its own separate listing—has materially reduced the likelihood of an Olive Young IPO.

The report states: "As dual-listing regulations constrain an Olive Young IPO, the value of its earnings growth is expected to accrue in full to the holding company." Accordingly, the target price incorporates an additional 25% restoration of Olive Young's equity value.

CJ Corp.'s effective voting stake in Olive Young has also risen from 51.2% to 66.1%, a development the report interprets as a meaningful expansion of the holding company's actual control and value entitlement over its key subsidiary.

Earnings Outlook

On a consolidated basis for 2026, revenue is estimated at 46.2 trillion won and operating profit at 2.8 trillion won. CJ Olive Young is identified as the primary earnings driver, with foreign visitors now accounting for more than 25% of offline sales and shopping demand spreading beyond the Seoul metropolitan area to regional markets.

Shareholder Returns

On the capital-return front, the company raised its 2025 fiscal year-end dividend per share (DPS) by 10% year-on-year to 3,300 won. CJ Corp. currently holds approximately 2.13 million treasury shares, representing 5.98% of total shares issued, and has publicly disclosed that these will be deployed "in a manner that enhances medium- to long-term shareholder value."

The report concludes: "Should the company's corporate value enhancement plan translate into concrete decisions regarding the use of existing treasury shares and dividend policy, these would serve as meaningful catalysts for share price appreciation."