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.

Event-Driven

<p>As expected, both SKT and SK Square will remain on the KOSPI 200 after the split.</p><div><p>Then, here are the KRX corporate action schedule for both companies:</p></div><div><div class="content-highlight"><ol>
<li><strong>The market cap on the last trading day before the suspension will be applied in the index calculation during the trading suspension and the re-listing day.</strong></li>
<li><strong>The market cap on the re-listing day will be used in the index calculation on the next trading day.</strong></li>
<li><strong>That is, the actual price and market cap of each company will be reflected on the next trading day of the re-listing.</strong></li>
</ol></div></div><section class="figure"><p style="text-align: center;">[The KRX public disclosure concerning the SKT spin-off corporate actions]</p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/236/254/original/1.png?1634692082" class="editor-image img-responsive" data-smartkarma-image-id="236254"></figure></section><section class="figure"><p style="text-align: center;">[The KRX Corporate Actions &amp; Events Methodology]</p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/236/269/original/2.png?1634693952" class="editor-image img-responsive" data-smartkarma-image-id="236269"></figure></section><p>So, the daily flow of KOSPI 200 rebalancing trading due to this split is as follows.</p><ul>
<li><strong>We should expect an outflow of ₩248.0B (1.87x ADTV) at the close on October 25, assuming that the KOSPI 200-tracking ETFs/index funds actively engaged in portfolio rebalancing trading in line with the index corporate action is conservatively estimated at ₩20T (out of the total ₩80T, including pension funds and variable insurance index funds).</strong></li>
<li><strong>Based on the current share price, SKT's passive inflow is expected to be ₩149.6B at the close on November 29, and SK Square will likely reach ₩99.7B.</strong></li>
</ul><table class="table table-striped">
<colgroup>
<col width="150">
<col width="150">
<col width="150">
<col width="150">
</colgroup>
<tbody>
<tr><td colspan="4" data-sheets-value='{"1":2,"2":"SK Telecom trading timeline"}'>KOSPI 200-initiated portfolio rebalancing trading flow</td></tr>
<tr>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"Outflow"}'><strong>Outflow</strong></td>
<td colspan="2" style="text-align: center;" data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>Date</strong></td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"Inflow"}'><strong>Inflow</strong></td>
</tr>
<tr>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"₩248.0B"}'>
<p><strong>₩248.0B</strong></p>
<p><strong>(1.87x ADTV)</strong></p>
</td>
<td style="text-align: center;" data-sheets-value='{"1":3,"3":44494}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 10. 25</strong></td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"Last trading day before trade suspension"}'><strong>Last trading day before trade suspension</strong></td>
<td style="text-align: center;">-</td>
</tr>
<tr>
<td style="text-align: center;">-</td>
<td style="text-align: center;" data-sheets-value='{"1":3,"3":44495}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 10. 26</td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"Trade suspension begins"}'>Trade suspension begins</td>
<td style="text-align: center;">-</td>
</tr>
<tr>
<td style="text-align: center;">-</td>
<td style="text-align: center;" data-sheets-value='{"1":3,"3":44526}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 11. 26</td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"Trade suspension ends"}'>Trade suspension ends</td>
<td style="text-align: center;">-</td>
</tr>
<tr>
<td style="text-align: center;">-</td>
<td style="text-align: center;" data-sheets-value='{"1":3,"3":44529}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 11. 29</strong></td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"Re-listing"}'><strong>Relisting</strong></td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"₩149.6B for SKT &amp; ₩99.7B for SK Square"}'>
<p><strong>SKT: ₩149.6B</strong><br><strong>SK Square: ₩99.7B</strong></p>
<p><strong>(about the same as 1.87x ADTV)</strong></p>
</td>
</tr>
<tr>
<td style="text-align: center;">-</td>
<td style="text-align: center;" data-sheets-value='{"1":3,"3":44530}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 11. 30</td>
<td style="text-align: center;" data-sheets-value='{"1":2,"2":"The following day after re-listing"}'>The following day after relisting</td>
<td style="text-align: center;">-</td>
</tr>
<tr><td colspan="4" data-sheets-value='{"1":2,"2":"Source: KRX &amp; Clepsydra Capital"}'>Source: KRX &amp; Clepsydra Capital</td></tr>
</tbody>
</table><div class="content-highlight"><p><strong>Assuming that the stock price volatility risk during the trading suspension period is neutral, we definitely need to consider a strategy to pursue investment opportunities resulting from the KOSPI 200-initiated portfolio rebalancing trading, which purchases SKT stocks at the close on October 25 and sells them at the close on November 29.</strong></p></div>

As expected, both SKT and SK Square will remain on the KOSPI 200 after the split.Then, here are the KRX corporate action schedule for both companies:
The market cap on the last trading day before the suspension will be applied in the index calculation during the trading suspension and the re-listing day.
The market cap on the re-listing day will be used in the index calculation on the next trading day.
That is, the actual price and market cap of each company will be reflected on the next trading day of the re-listing.
[The KRX public disclosure concerning the SKT spin-off corporate actions]
[The KRX Corporate Actions &amp; Events Methodology]
So, the daily flow of KOSPI 200 rebalancing trading due to this split is as follows.
We should expect an outflow of ₩248.0B (1.87x ADTV) at the close on October 25, assuming that the KOSPI 200-tracking ETFs/index funds actively engaged in portfolio rebalancing trading in line with the index corporate action is conservatively estimated at ₩20T (out of the total ₩80T, including pension funds and variable insurance index funds).
Based on the current share price, SKT's passive inflow is expected to be ₩149.6B at the close on November 29, and SK Square will likely reach ₩99.7B.








KOSPI 200-initiated portfolio rebalancing trading flow

Outflow
Date
Inflow



₩248.0B
(1.87x ADTV)

2021. 10. 25
Last trading day before trade suspension
-


-
2021. 10. 26
Trade suspension begins
-


-
2021. 11. 26
Trade suspension ends
-


-
2021. 11. 29
Relisting

SKT: ₩149.6B SK Square: ₩99.7B
(about the same as 1.87x ADTV)



-
2021. 11. 30
The following day after relisting
-

Source: KRX &amp; Clepsydra Capital

Assuming that the stock price volatility risk during the trading suspension period is neutral, we definitely need to consider a strategy to pursue investment opportunities resulting from the KOSPI 200-initiated portfolio rebalancing trading, which purchases SKT stocks at the close on October 25 and sells them at the close on November 29.

SKT Split: Daily Trading Flow Before/After Trading Suspension

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Thematic (Sector/Industry)

<p>There were four new<a href="http://www.koreaherald.com/view.php?ud=20211013001007" target="_blank" rel="noopener"> metaverse related ETFs</a> were launched in Korea on 13 October for the first time ever in the Korean stock market. The first three ETFs (KBSTAR iSelect Metaverse, Hanaro Fn K-Metaverse MZ, and Tiger Fn Metaverse) are passive funds. KODEX K-Metaverse Active is an active fund. These four new ETFs are as follows:</p><p><strong>1) Tiger Fn Metaverse</strong> (managed by Mirae Asset Global Investment)</p><p><strong>2) KBSTAR iSelect Metaverse</strong> (managed by KB Asset Management)</p><p><strong>3) Hanaro Fn K-Metaverse MZ</strong> (managed by NH Amundi Asset Management)</p><p><strong>4) KODEX K-Metaverse Active</strong>  (managed by Samsung Asset Management)</p><p>The stocks that are included in these metaverse related names also tend to be higher beta ones that could perform much better in a rising market environment. However, because these stocks tend to be higher beta stocks with high valuation multiples, it could be challenging for these stocks to outperform the market when the market downturn occurs. </p>

There were four new metaverse related ETFs were launched in Korea on 13 October for the first time ever in the Korean stock market. The first three ETFs (KBSTAR iSelect Metaverse, Hanaro Fn K-Metaverse MZ, and Tiger Fn Metaverse) are passive funds. KODEX K-Metaverse Active is an active fund. These four new ETFs are as follows:1) Tiger Fn Metaverse (managed by Mirae Asset Global Investment)2) KBSTAR iSelect Metaverse (managed by KB Asset Management)3) Hanaro Fn K-Metaverse MZ (managed by NH Amundi Asset Management)4) KODEX K-Metaverse Active  (managed by Samsung Asset Management)The stocks that are included in these metaverse related names also tend to be higher beta ones that could perform much better in a rising market environment. However, because these stocks tend to be higher beta stocks with high valuation multiples, it could be challenging for these stocks to outperform the market when the market downturn occurs. 

Listing of 4 New Metaverse Related ETFs in Korea

<h2>October 12 EGM results</h2><p>SK Telecom's demerger and stock split got shareholder approval yesterday.</p><div class="content-highlight"><p><strong>Based on the number of attending votes, the approval rate for the demerger reached 99.95%, and the approval rate for the stock split was 99.96%, receiving overwhelming support from individual shareholders as well as institutions, including the National Pension Service.</strong></p></div><section class="figure"><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/234/760/original/3.png?1634066969" class="editor-image img-responsive" data-smartkarma-image-id="234760"></figure></section><p>As a result of this, SK Telecom and SK Square will be officially launched on November 1, the record date of the demerger. The current SK Telecom will be listed and re-listed as SK Telecom and SK Square, respectively, on November 29 after a period of stock trading suspension from October 26 to November 26.</p>
<table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Schedule"}'>Schedule</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Trade suspension begins"}'>Trade suspension begins</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44495}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 10. 26</td>
</tr>
<tr>
<td><strong>Record date of demerger</strong></td>
<td style="text-align: right;"><strong>2021. 11. 01</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Trade suspension ends"}'>Trade suspension ends</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44526}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 11. 26</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Re-listing"}'><strong>Re-listing</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44529}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 11. 29</strong></td>
</tr>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table></section><p>SK Telecom plans to transform itself into a telecom service, artificial intelligence, and digital infrastructure service company and increase its annual sales from ₩15T in 2020 to ₩22T in 2025.</p><div class="content-highlight"><ul>
<li>As for the Telecom service business, it plans to solidify 5G leadership and continue the growth of media services. In the case of AI-based services, it will evolve the subscription service (T Universe) into an online and offline subscription commerce platform. Lastly, the company plans to fully expand its high-growth data center, cloud, and industrial Internet of Things (IoT) businesses by utilizing 5G MEC (mobile edge computing) for the digital infrastructure service business.</li>
<li>SK Square will be launched as a semiconductor/ICT investment company. Based on the successful DNA accumulated through investments in the semiconductor and ICT platform business so far, the company has set a vision to increase its net asset value from the current ₩26T to ₩75T by 2025.</li>
</ul></div><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Vision 2025"}'>Vision 2025</td>
<td data-sheets-value='{"1":2,"2":"SK Telecom"}'>SK Telecom</td>
<td data-sheets-value='{"1":2,"2":"SK Square"}'>SK Square</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Core business areas"}'>Core business areas</td>
<td data-sheets-value='{"1":2,"2":"Telecom service, AI-based service, &amp; digital infrastructure"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.00T","3":1}'>Telecom service, AI-based service, &amp; digital infrastructure</td>
<td data-sheets-value='{"1":2,"2":"Semiconductor &amp; ICT investment"}'><div><div>Semiconductor &amp; ICT investment</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Current value"}'>Current value</td>
<td data-sheets-value='{"1":2,"2":"FY2020 annual sales of ₩15T"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.00T","3":1}'>FY2020 annual sales of ₩15T</td>
<td data-sheets-value='{"1":2,"2":"FY2021 net asset value of ₩26T"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.00T","3":1}'>FY2021 net asset value of ₩26T</td>
</tr>
<tr><td colspan="3"></td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Target by FY2025"}'><strong>Target by FY2025</strong></td>
<td data-sheets-value='{"1":2,"2":"Annual sales of ₩22T"}'><strong>Yearly sales of ₩22T</strong></td>
<td data-sheets-value='{"1":2,"2":"Net asset value of ₩75T"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.00T","3":1}'><strong>Net asset value of ₩75T</strong></td>
</tr>
<tr><td colspan="3" data-sheets-value='{"1":2,"2":"Source: SK Telecom"}'>Source: SK Telecom</td></tr>
</tbody>
</table><p>After the demerger, SK Telecom will have SK Broadband, SK Telink, PS&amp;Marketing, F&amp;U Credit Information, Service Top, Service Ace, and SK O&amp;S as subsidiaries. On the other hand, 16 companies will be placed under SK Square: SK Hynix, ADT Caps, 11st Street, T Map Mobility, One Store, Contents Wavve, Dream Us Company, and SK Planet.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"SK Telecom"}'>SK Telecom</td>
<td data-sheets-value='{"1":2,"2":"SK Investment"}'>SK Square</td>
</tr>
<tr>
<td><strong>: 7 in total</strong></td>
<td><strong>: 16 in total</strong></td>
</tr>
<tr><td colspan="2"></td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SK Broadband"}'>SK Broadband</td>
<td data-sheets-value='{"1":2,"2":"SK Hynix"}'>SK Hynix</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SK Telink"}'>SK Telink</td>
<td data-sheets-value='{"1":2,"2":" ADT Caps"}'>ADT Caps</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"PS&amp;Marketing"}'>PS&amp;Marketing</td>
<td data-sheets-value='{"1":2,"2":"11st Street"}'>11st Street</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"F&amp;S Credit Info"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>F&amp;S Credit Info</td>
<td data-sheets-value='{"1":2,"2":"T Map Mobility"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>T Map Mobility</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Servie Top"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Service Top</td>
<td data-sheets-value='{"1":2,"2":"One Store"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>One Store</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Service Ace"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Service Ace</td>
<td data-sheets-value='{"1":2,"2":" Contents Wavve"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Contents Wavve</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SK O&amp;S"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>SK O&amp;S</td>
<td data-sheets-value='{"1":2,"2":"Dream Us Company"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Dream Us Company</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":3,"2":"0.00000%"}'></td>
<td data-sheets-value='{"1":2,"2":"SK Planet"}'>SK Planet</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"FSK L&amp;S"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>FSK L&amp;S</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"Incross"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Incross</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"NanoNtech"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Nano N Tech</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"Spark Plus"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Spark Plus</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"SK Telecom CST1"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'><div>SK Telecom CST1</div></td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"SK Telecom TMT Investment"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'><div>SK Telecom TMT Investment</div></td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"ID Quantique"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>ID Quantique</td>
</tr>
<tr>
<td data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'></td>
<td data-sheets-value='{"1":2,"2":"Techmaker"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Techmaker</td>
</tr>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Source: SED"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>Source: SK Telecom</td></tr>
</tbody>
</table><hr><div class="content-highlight">
<p><strong>In a separate regulatory filing,</strong></p>
<p>SKT said that it would transfer 520,000 treasury shares to its employees. In other words, SKT is giving 100 shares of treasury stock to each employee. Based on the closing price of ₩304,500 on October 8, this is equivalent to ₩158.3B.</p>
<p>It represents 0.72% of the total issued shares and about 60% of its current treasury shares. After this transaction, SKT's treasury shares will fall to 379,500, 0.53% of the shares outstanding.</p>
</div><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/234/761/original/4.png?1634069235" class="editor-image img-responsive" data-smartkarma-image-id="234761"></figure></section>

October 12 EGM resultsSK Telecom's demerger and stock split got shareholder approval yesterday.Based on the number of attending votes, the approval rate for the demerger reached 99.95%, and the approval rate for the stock split was 99.96%, receiving overwhelming support from individual shareholders as well as institutions, including the National Pension Service.As a result of this, SK Telecom and SK Square will be officially launched on November 1, the record date of the demerger. The current SK Telecom will be listed and re-listed as SK Telecom and SK Square, respectively, on November 29 after a period of stock trading suspension from October 26 to November 26.






Schedule

Trade suspension begins
2021. 10. 26


Record date of demerger
2021. 11. 01


Trade suspension ends
2021. 11. 26


Re-listing
2021. 11. 29

Source: DART

SK Telecom plans to transform itself into a telecom service, artificial intelligence, and digital infrastructure service company and increase its annual sales from ₩15T in 2020 to ₩22T in 2025.
As for the Telecom service business, it plans to solidify 5G leadership and continue the growth of media services. In the case of AI-based services, it will evolve the subscription service (T Universe) into an online and offline subscription commerce platform. Lastly, the company plans to fully expand its high-growth data center, cloud, and industrial Internet of Things (IoT) businesses by utilizing 5G MEC (mobile edge computing) for the digital infrastructure service business.
SK Square will be launched as a semiconductor/ICT investment company. Based on the successful DNA accumulated through investments in the semiconductor and ICT platform business so far, the company has set a vision to increase its net asset value from the current ₩26T to ₩75T by 2025.








Vision 2025
SK Telecom
SK Square


Core business areas
Telecom service, AI-based service, &amp; digital infrastructure
Semiconductor &amp; ICT investment


Current value
FY2020 annual sales of ₩15T
FY2021 net asset value of ₩26T



Target by FY2025
Yearly sales of ₩22T
Net asset value of ₩75T

Source: SK Telecom

After the demerger, SK Telecom will have SK Broadband, SK Telink, PS&amp;Marketing, F&amp;U Credit Information, Service Top, Service Ace, and SK O&amp;S as subsidiaries. On the other hand, 16 companies will be placed under SK Square: SK Hynix, ADT Caps, 11st Street, T Map Mobility, One Store, Contents Wavve, Dream Us Company, and SK Planet.






SK Telecom
SK Square


: 7 in total
: 16 in total



SK Broadband
SK Hynix


SK Telink
ADT Caps


PS&amp;Marketing
11st Street


F&amp;S Credit Info
T Map Mobility


Service Top
One Store


Service Ace
Contents Wavve


SK O&amp;S
Dream Us Company



SK Planet



FSK L&amp;S



Incross



Nano N Tech



Spark Plus



SK Telecom CST1



SK Telecom TMT Investment



ID Quantique



Techmaker

Source: SK Telecom


In a separate regulatory filing,
SKT said that it would transfer 520,000 treasury shares to its employees. In other words, SKT is giving 100 shares of treasury stock to each employee. Based on the closing price of ₩304,500 on October 8, this is equivalent to ₩158.3B.
It represents 0.72% of the total issued shares and about 60% of its current treasury shares. After this transaction, SKT's treasury shares will fall to 379,500, 0.53% of the shares outstanding.


SKT Demerger Got Shareholder Approval & SK Square NAV Analysis

<p>In this insight, we provide a detailed sensitivity analysis of the dividend payments and yields of SK Square and SK Telecom on a post split basis. </p><p><strong>SK Square</strong> - In the next 2 to 3 years, we expect SK Square to focus on growth and investments rather than on dividends. In our view, the dividend yield for SK Square is likely to be about 1.0-1.4% in the next 2-3 years. SK Square's focus is likely to be growth and investments rather than paying out high dividends. </p><div class="content-highlight">
<p><strong>SK Telecom</strong> - Overall, we believe that the higher probability scenario is for SK Telecom's dividend yield to become more competitive with its biggest competitor KT Corp so SK Telecom's dividend yield is likely to rise to about 4.0% to 4.5% range, in our view. For many dividend seeking investors, dividend yield of 4.0% to 4.5% combined with SK Telecom's increasing economies of scale of 5G business would be quite attractive indeed.</p>
<p>The dividend guidance that SK Telecom has provided is that the dividends for SKT (existing entity) will be within a range of 30% to 40% of its EBITDA minus CapEx. We estimate SK Telecom to have EBITDA - CapEx of 2.0 trillion won in 2021 and 2.4 trillion won in 2022.  </p>
<p>If we assume the SK Telecom will generate EBITDA - CapEx of 2.0 trillion won in 2021, a 30% of this amount would be 610.7 billion won and a 35% would be worth 712.5 billion won.</p>
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In this insight, we provide a detailed sensitivity analysis of the dividend payments and yields of SK Square and SK Telecom on a post split basis. SK Square - In the next 2 to 3 years, we expect SK Square to focus on growth and investments rather than on dividends. In our view, the dividend yield for SK Square is likely to be about 1.0-1.4% in the next 2-3 years. SK Square's focus is likely to be growth and investments rather than paying out high dividends. 
SK Telecom - Overall, we believe that the higher probability scenario is for SK Telecom's dividend yield to become more competitive with its biggest competitor KT Corp so SK Telecom's dividend yield is likely to rise to about 4.0% to 4.5% range, in our view. For many dividend seeking investors, dividend yield of 4.0% to 4.5% combined with SK Telecom's increasing economies of scale of 5G business would be quite attractive indeed.
The dividend guidance that SK Telecom has provided is that the dividends for SKT (existing entity) will be within a range of 30% to 40% of its EBITDA minus CapEx. We estimate SK Telecom to have EBITDA - CapEx of 2.0 trillion won in 2021 and 2.4 trillion won in 2022.  
If we assume the SK Telecom will generate EBITDA - CapEx of 2.0 trillion won in 2021, a 30% of this amount would be 610.7 billion won and a 35% would be worth 712.5 billion won.


SK Square & SK Telecom - Sensitivity Analysis of Dividend Payments & Yields

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<p>In this insight, we provide 8 examples of how metaverse is revolutionizing numerous businesses in Korea. We also provide a list of Korean companies that are actively trying to expand their metaverse businesses. Because metaverse is in the initial stages of growth for many of these businesses, their contributions to their companies' sales and profits may not be meaningful right now. However, they are experiencing a significant popularity. Metaverse is certainly one of the key industry trends that is likely to have a multi-years impact on the companies mentioned in this insight.</p>
<p>The term "metaverse" was first coined by the writer Neal Stephenson in his 1992 science fiction novel <a href="https://digiday.com/marketing/wtf-is-the-metaverse/" target="_blank" rel="noopener"><em>Snow Crash </em></a>where metaverse refers to a popular virtual world where the main characters are equipped with augmented technologies. </p>
<p>Metaverse refers to a computerized domain where the users can share their virtual encounters. Still in the beginning phases of advancement, metaverse has become more important in key industries industries including technology, media, and telecom. In addition, metaverse is also impacting other major industries such as retail, gaming, and fashion. </p>
<p>Metaverse will empower its users to be more engaged in online shopping, web-based media, entertainment, and share virtual encounters. Metaverse is often considered as a "coming together" of numerous technologies including augmented reality (AR), virtual reality (VR), 5G, smartphones, and distributed computing. Up until recently, the gaming industry has been driving the demand for metaverse. However, greater improvements in technologies have allowed metaverse to flourish in other industries as well. </p>
<p>South Korea is one of the key countries driving the metaverse industry globally. This is one of the leaders in this area and there will be numerous, interesting opportunities involving metaverse in Korea. </p>
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In this insight, we provide 8 examples of how metaverse is revolutionizing numerous businesses in Korea. We also provide a list of Korean companies that are actively trying to expand their metaverse businesses. Because metaverse is in the initial stages of growth for many of these businesses, their contributions to their companies' sales and profits may not be meaningful right now. However, they are experiencing a significant popularity. Metaverse is certainly one of the key industry trends that is likely to have a multi-years impact on the companies mentioned in this insight.
The term "metaverse" was first coined by the writer Neal Stephenson in his 1992 science fiction novel Snow Crash where metaverse refers to a popular virtual world where the main characters are equipped with augmented technologies. 
Metaverse refers to a computerized domain where the users can share their virtual encounters. Still in the beginning phases of advancement, metaverse has become more important in key industries industries including technology, media, and telecom. In addition, metaverse is also impacting other major industries such as retail, gaming, and fashion. 
Metaverse will empower its users to be more engaged in online shopping, web-based media, entertainment, and share virtual encounters. Metaverse is often considered as a "coming together" of numerous technologies including augmented reality (AR), virtual reality (VR), 5G, smartphones, and distributed computing. Up until recently, the gaming industry has been driving the demand for metaverse. However, greater improvements in technologies have allowed metaverse to flourish in other industries as well. 
South Korea is one of the key countries driving the metaverse industry globally. This is one of the leaders in this area and there will be numerous, interesting opportunities involving metaverse in Korea. 


How Is Metaverse Revolutionizing Businesses in Korea? Virtual Humans Rozy & Lucy Are Just a Start

South Korea

SK Telecom Co., Ltd. is a Korean mobile and telecommunications operator. The Company provides cellular voice, wireless data, and wireless internet services. SK Telecom also offers fixed line services and platform services.

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SK Telecom (017670 KS)

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