Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>The most important reason for KT's excellent results in 2Q 2025 was due to the major hacking incident at SK Telecom in May 2025.</li>
<li>The company's growing AI business and successful real estate sales also contributed to the company's improving results in 2Q 2025. </li>
<li>KT is likely to benefit from higher profits and returns on capital in the next couple of years as the penetration of 5G service surpasses more than 80%.</li>
</ul>


The most important reason for KT's excellent results in 2Q 2025 was due to the major hacking incident at SK Telecom in May 2025.
The company's growing AI business and successful real estate sales also contributed to the company's improving results in 2Q 2025. 
KT is likely to benefit from higher profits and returns on capital in the next couple of years as the penetration of 5G service surpasses more than 80%.


KT Corp: Excellent 2Q 2025 Earnings Driven by Market Share Gain and Improving AI/Cloud Businesses

External broker reports(aggregated public sources), Daishin Securities

Daishin Securities

External broker reports(aggregated public sources)

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<ul><li>4Q24 revenue W6.6tn (-2% YoY), OP -W660bn (YoY swing to deficit)</li><li>4Q24 OP W350bn (+30% YoY); 2024 OP W1.8tn (+10% YoY), if removing oneoff labor costs </li><li>2025E OP W2.6tn (+222% YoY), TSR W750bn–W860bn, return 6.5%–7.6%</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

4Q24 revenue W6.6tn (-2% YoY), OP -W660bn (YoY swing to deficit)4Q24 OP W350bn (+30% YoY); 2024 OP W1.8tn (+10% YoY), if removing oneoff labor costs 2025E OP W2.6tn (+222% YoY), TSR W750bn–W860bn, return 6.5%–7.6%Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

KT (030200 KS) - Stronger and Faster than Expected

<ul>
<li>We have a Positive view of KT Corp (030200 KS) due to three main reasons.</li>
<li>First, KT has started to implement aggressive capital return policy (returning 50% of net income through dividends and share buybacks/cancellations). Two other reasons include Corporate Value Up and higher Smartscore.</li>
<li>KT Corp has been the best performing stock among the three major Korean telcos in the past one year. KT Corp's shares are up 27.9% in the past one year.</li>
</ul>


We have a Positive view of KT Corp (030200 KS) due to three main reasons.
First, KT has started to implement aggressive capital return policy (returning 50% of net income through dividends and share buybacks/cancellations). Two other reasons include Corporate Value Up and higher Smartscore.
KT Corp has been the best performing stock among the three major Korean telcos in the past one year. KT Corp's shares are up 27.9% in the past one year.


Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Index Rebalance

<ul>
<li>KT’s foreign room is likely staying below 3.75% for November, setting up an ETF recall play. We've seen short-term buying pressure in similar past index reshuffles.</li>
<li>The ETF recall impact peaks right after the announcement. KT’s May downweight saw a 5% spike in two trading days post-announcement.</li>
<li>KT’s price moves more with downweights than SK Telecom’s because of higher overseas borrowing demand. This trend should hold, so setting up a position before the November announcement makes sense.</li>
</ul>


KT’s foreign room is likely staying below 3.75% for November, setting up an ETF recall play. We've seen short-term buying pressure in similar past index reshuffles.
The ETF recall impact peaks right after the announcement. KT’s May downweight saw a 5% spike in two trading days post-announcement.
KT’s price moves more with downweights than SK Telecom’s because of higher overseas borrowing demand. This trend should hold, so setting up a position before the November announcement makes sense.


Timing a Trade to Capitalize on KT’s November Global Index Deletion and the ETF Recall

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>Foreign investors have continued buying <a href="https://www.smartkarma.com/entities/kt-corp" target="_blank" data-smartkarma-citation="entities:1112:1" rel="noopener">KT Corp (030200 KS)</a> and the stock has outperformed <a href="https://www.smartkarma.com/entities/sk-telecom-co-ltd-bbccd86c-474d-4a4d-946d-10e911a225a2" target="_blank" data-smartkarma-citation="entities:395:1" rel="noopener">SK Telecom (017670 KS)</a>, though not by a lot. </li>
<li>Foreign buying has pushed foreign room in <a href="https://www.smartkarma.com/entities/kt-corp" target="_blank" data-smartkarma-citation="entities:1112:1" rel="noopener">KT Corp (030200 KS)</a> below 3.75% and the stock could be deleted from a global index at the next rebalance.</li>
<li>There will be some interesting trading dynamics in <a href="https://www.smartkarma.com/entities/kt-corp" target="_blank" data-smartkarma-citation="entities:1112:1" rel="noopener">KT Corp (030200 KS)</a> over the next couple of months and there will be trading opportunities versus its peers.</li>
</ul>


Foreign investors have continued buying KT Corp (030200 KS) and the stock has outperformed SK Telecom (017670 KS), though not by a lot. 
Foreign buying has pushed foreign room in KT Corp (030200 KS) below 3.75% and the stock could be deleted from a global index at the next rebalance.
There will be some interesting trading dynamics in KT Corp (030200 KS) over the next couple of months and there will be trading opportunities versus its peers.


KT Corp (030200 KS): Foreign Room Drops Below Critical Level; Passive Selling to Come

South Korea

KT Corporation provides telecommunication services including local, long distance, and international calling, satellite communication, data transmission, and wireless telephone services in South Korea.  The Company also offers network portal and high-speed Internet access services using asymmetric digital subscriber lines (ADSLs).

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KT Corp (030200 KS)

KT (030200 KS) - Stronger and Faster than Expected

4Q24 revenue W6.6tn (-2% YoY), OP -W660bn (YoY swing to deficit). 4Q24 OP W350bn (+30% YoY); 2024 OP W1.8tn (+10% YoY), if removing oneoff labor costs

Daishin Securities

Asian Dividend Gems: KT Corp

Positive outlook on KT Corp (030200 KS) due to aggressive capital return policy, Corporate Value Up, and higher Smartscore leading to strong stock...

Douglas Kim

Timing a Trade to Capitalize on KT’s November Global Index Deletion and the ETF Recall

This post discusses the high likelihood of KT being booted from the November Global Index review due to its foreign room staying below 3.75%, and...

Sanghyun Park

KT Corp (030200 KS): Foreign Room Drops Below Critical Level; Passive Selling to Come

KT Corp's foreign room has dropped below 3.75% and that could result in deletion from a global index in November. Foreign buying has been...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

KT Corp: Excellent 2Q 2025 Earnings Driven by Market Share Gain and Improving AI/Cloud Businesses

KT reported excellent results in 2Q25 due to the major hacking incident at SK Telecom. KT's growing AI business and successful real estate sales...

Douglas Kim

KT (030200 KS) - Stronger and Faster than Expected

4Q24 revenue W6.6tn (-2% YoY), OP -W660bn (YoY swing to deficit). 4Q24 OP W350bn (+30% YoY); 2024 OP W1.8tn (+10% YoY), if removing oneoff labor costs

Daishin Securities

Asian Dividend Gems: KT Corp

​Positive outlook on KT Corp (030200 KS) due to aggressive capital return policy, Corporate Value Up, and higher Smartscore leading to strong stock...

Douglas Kim

Timing a Trade to Capitalize on KT’s November Global Index Deletion and the ETF Recall

This post discusses the high likelihood of KT being booted from the November Global Index review due to its foreign room staying below 3.75%, and...

Sanghyun Park

KT Corp (030200 KS): Foreign Room Drops Below Critical Level; Passive Selling to Come

KT Corp's foreign room has dropped below 3.75% and that could result in deletion from a global index in November. Foreign buying has been...

Brian Freitas

Positive outlook on KT Corp (030200 KS) due to aggressive capital return policy, Corporate Value Up, and higher Smartscore leading to strong stock...