KT&G officials talk during a meeting held at the company’s corporate entity in Uzbekistan. (KT&G)
KT&G officials talk during a meeting held at the company’s corporate entity in Uzbekistan. (KT&G)

South Korea's largest tobacco company KT&G on Monday announced its establishment of a subsidiary in Uzbekistan, aiming to boost profitability through local operations while continuing its strategic entry into the Eurasian tobacco market.

The move follows the company's establishment of a branch office in Uzbekistan in 2023, with its transformation into a corporate subsidiary signaling a sustained commitment to building long-term competitiveness in the region.

In line with the expansion, the company plans to increase its local workforce more than fourfold while developing its sales network in the market, according to a KT&G official.

KT&G's signature brand Esse has gained significant traction in Uzbekistan, where its super-slim quality continues to appeal to local consumers, and will remain the key brand driving growth in the market.

Last year, the company sold a total of 270 million cigarettes from the seven Esse products in the region, with Esse Change accounting for 64 percent of the export volume. In terms of overseas sales, the firm posted an record 420 billion won ($285 million) in the third quarter of last year, marking a 30.5 percent on-year increase.

In pursuit of its overseas strategy, KT&G has been enhancing organizational efficiency and regional focus by operating six overseas entities in countries such as Indonesia, Kazakhstan and Turkey, along with three branch offices abroad. Its conventional cigarette products are currently available in 132 countries.

In tandem with its expanded local operations, the company also operates manufacturing plants in Russia, Turkey and Indonesia, with a new Indonesian facility and a plant in Kazakhstan currently under construction.

"The establishment of the new Uzbekistan entity signifies our investment and innovation efforts toward becoming a top-tier global company," the official stated. "We will continue to drive growth in our global business through localized operations."