汇丰银行-韩国消费-korea consumer：three stocks to own in the current environment-20170721-hsbc.pdfVIP

21 July 2017   Korea Consumer EQUITIES CONSUMER Three stocks to own in the current environment Korea  2Q earnings expected to be weak – not a surprise given Karen Choi* China’s restriction of tourism to Korea from mid-March Head of Consumer and Retail Research, Asia-Pacific The Hongkong and Shanghai Banking Corporation Limited, Seoul Securities Branch  The focus now should be on recovery and market share gains karen.choi@ +822 3706 8781 in mainland China * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is  We continue to like AmorePacific, LG HH and Hotel Shilla, not registered/ qualified pursuant to FINRA regulations all rated Buy What’s new? Given China’s restriction of group tours to Korea from 15 March 2017, Chinese inbound tourism continues to be weak, with April/May down 66.6% and 64.1% y-o-y, respectively. This will inevitably weigh on 2Q earnings, especially for cosmetic companies and duty-free operators. However, when earnings are released, we expect shares to recover given