[THE INVESTOR] CJ Korea Express, the logistics unit of CJ Group, is likely to show continuous growth, backed by the recent establishment of a joint venture with Chinese appliance giant TCL and earnings improvements, a local brokerage firm said on Aug. 5.

CJ Korea Express’ second-quarter earnings beat market consensus as its revenue rose 19.5 percent on-year to 1.51 trillion won (US$1.35 billion) and operating profit climbed 33.6 percent, said Jung Yoo-seok, an analyst at Kyobo Securities.

“Its contract logistics and delivery service businesses evenly generate growth. Its global operation also posted a 14 percent increase in revenue,” he said.

Setting up CJ Speedex, a 50:50 JV with TCL, China’s third-largest home appliance manufacturer, will be beneficial for CJ Korea Express to get a foothold in the Chinese market.

On Aug. 3, the company announced that it will invest 486 million yuan (US$73 million) to acquire 50 percent stake in TCL’s logistics affiliate Speedex that handles transport of the company’s home appliances and smartphones.

Kyobo Securities hiked its price target on the stock to 220,000 won while maintaining a buy rating.

CJ Korea Express shares fell 1.17 percent to 211,500 won in afternoon trading.

By Park Han-na (hnpark@heraldcorp.com)