South Korea’s baby care sector sees ironic boom as families ‘show their love’ by splurging

The surge comes as grandparents as well as uncles and aunts increase spending on their family’s only child, analysts said.

According to the Korea Exchange, Agabang & Company gained more than 70 per cent on the junior bourse Kosdsaq this year.

A wholesaler of apparel, skin care products and a range of baby care items, Agabang & Company made such gains as South Korea’s total fertility rate dipped to 0.72 in 2023.

The country broke its own record for the world’s lowest total fertility rate, which has been declining since 2015 when the figure came to 1.24. The rate fell to 0.92 in 2019, 0.84 in 2020, 0.81 in 2021 and 0.78 in 2022.

Agabang & Company also advanced 5.91 per cent to close at 6,450 won (US$4.80) on Thursday, a day after Statistics Korea announced that the country’s quarterly total fertility rate had slipped to a historic low of 0.65 in the October-to-December period in 2023.

Under the circumstances, a Yuanta Securities analyst explained that the upward trajectory of Agabang & Company is associated with consumer spending characterised as “10 pockets”.

The term stems from members of a family, including parents, grandparents, as well as uncles and aunts, who number around 10 combined.

They are noted for their generous spending on a baby, who often tends to be their family’s only child.

“At first sight, it may appear that a shrinking number of babies may result in a dwindling baby care industry,” the analyst said. “But in fact, it makes children scarce and special, thus prompting their families to spend more on relevant goods as a way to show their love.”

He pointed out that online transactions for baby care products were worth 5.23 trillion won in 2022, up 0.7 per cent from the previous year. During the cited period,