[THE INVESTOR] Lotte Shopping’s profitability will improve from selling discount stores in China and its online business will pick up, said Mirae Asset Daewoo on June 11 suggesting a “buy” recommendation and 265,000 won (US$247.11) target price. 

Its offline business will gain momentum this year as it wraps up discount store operations in China that struggled over the past two years. When it completes selling off its discount chain profits will significantly improve. Profits from department stores will also be boosted by luxury and lifestyle segments which will help its rebound, said the analyst Kim Myeong-ju.

Lotte plans to invest 3 trillion won in the next 5 years to merge online platform and system, that can trigger associated sales and a competitive edge. It will be able to develop a differentiated online platform and through successful investments and synergies it will stand out, she added.

By Hwang You-mee (glamazon@heraldcorp.com)