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

<ul>
<li>The reason why the president’s office is considering temporarily easing bank–industry separation is to facilitate funding for the 150T won National Growth Fund.</li>
<li>Samsung and SK may form bank-backed JVs to fund AI semis, HBM, and data center projects, enabling flexible capital deployment across the AI semiconductor ecosystem.</li>
<li>Chaebol holdings with direct AI exposure could gain smoother access to big-ticket funding, potentially sparking continued aggressive short-term flows around Samsung and SK holdings post-Chuseok.</li>
</ul>


The reason why the president’s office is considering temporarily easing bank–industry separation is to facilitate funding for the 150T won National Growth Fund.
Samsung and SK may form bank-backed JVs to fund AI semis, HBM, and data center projects, enabling flexible capital deployment across the AI semiconductor ecosystem.
Chaebol holdings with direct AI exposure could gain smoother access to big-ticket funding, potentially sparking continued aggressive short-term flows around Samsung and SK holdings post-Chuseok.


A Clear Understanding of the Narrative Around Easing Bank–Industry Separation in Korea

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>Three main reasons why SK Inc is our high conviction in 2026 include mandatory cancellation of treasury shares, deep discount to NAV, and the end of divorce for Chairman Chey. </li>
<li>SK Inc has 17.98 million shares in treasury, representing 24.8% of outstanding shares. Among the stocks included in KOSPI200, this is one of the highest percentage of treasury shares.</li>
<li>Our NAV valuation analysis suggests NAV of 28 trillion won or NAV per share of 386,469 won. This represents a 46% upside to its current price.</li>
</ul>


Three main reasons why SK Inc is our high conviction in 2026 include mandatory cancellation of treasury shares, deep discount to NAV, and the end of divorce for Chairman Chey. 
SK Inc has 17.98 million shares in treasury, representing 24.8% of outstanding shares. Among the stocks included in KOSPI200, this is one of the highest percentage of treasury shares.
Our NAV valuation analysis suggests NAV of 28 trillion won or NAV per share of 386,469 won. This represents a 46% upside to its current price.


<ul>
<li>Korean equities are stalled; macro catalysts are absent. Street focus shifts from treasury share cancellations to next year’s mandatory tender offers, now seen as the top policy driver.</li>
<li>Pre-MTO trades focus on holding companies with wide NAV discounts or low controlling stakes, front-running policy-driven re-ratings before minority shareholders capture control premiums.</li>
<li>Focus on 32 Korean holding companies &gt;KRW 500B; those with wide NAV discounts and lighter controlling stakes—SK's holding companies, Samsung C&amp;T, Hanwha, LG, LS—are prime re-rating plays.</li>
</ul>


Korean equities are stalled; macro catalysts are absent. Street focus shifts from treasury share cancellations to next year’s mandatory tender offers, now seen as the top policy driver.
Pre-MTO trades focus on holding companies with wide NAV discounts or low controlling stakes, front-running policy-driven re-ratings before minority shareholders capture control premiums.
Focus on 32 Korean holding companies &gt;KRW 500B; those with wide NAV discounts and lighter controlling stakes—SK's holding companies, Samsung C&amp;T, Hanwha, LG, LS—are prime re-rating plays.


Holdco NAV Discount Compression Play on Korea’s Next Policy Narrative: Mandatory Tender Offers

<ul>
<li>Hunting the reversion point for Square-Hynix price ratio amid local buzz: need clear pro-business tax signals and Hynix’s downtrend to continue despite today’s bounce.</li>
<li>Tax tweak likely turns neutral despite gov’s cautious tone today. Hynix’s bounce faces headwinds from supply ramp and yield issues, so fresh rally odds remain slim.</li>
<li>Focus on hunting SK Square vs. Hynix price ratio reversion, pairing it with Samsung Long/Hynix Short for a strong short-term trade setup to ride the trend.</li>
</ul>


Hunting the reversion point for Square-Hynix price ratio amid local buzz: need clear pro-business tax signals and Hynix’s downtrend to continue despite today’s bounce.
Tax tweak likely turns neutral despite gov’s cautious tone today. Hynix’s bounce faces headwinds from supply ramp and yield issues, so fresh rally odds remain slim.
Focus on hunting SK Square vs. Hynix price ratio reversion, pairing it with Samsung Long/Hynix Short for a strong short-term trade setup to ride the trend.


Identifying the SK Square Vs. Hynix Price Ratio Reversion Alpha Setup

<ul>
<li>We are changing our View on SK Square (402340 KS) to Negative.</li>
<li>The major reason for this change is due to the surge in its share price along with lack of upside relative to its NAV.</li>
<li>Regarding SK Square, our holdco discount remains 40%. However, if there are real, positive continued efforts to improve corporate governance, this holdco discount could be reduced further.   </li>
</ul>


We are changing our View on SK Square (402340 KS) to Negative.
The major reason for this change is due to the surge in its share price along with lack of upside relative to its NAV.
Regarding SK Square, our holdco discount remains 40%. However, if there are real, positive continued efforts to improve corporate governance, this holdco discount could be reduced further.   


SK Square: Time to Take Profits + Why Are There Holdco Discounts in the First Place?

South Korea

SK Square Co., Ltd. operates as an investment company. The Company invests in semiconductors, information and communications technologies, and other industries. SK Square conducts businesses in South Korea.

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SK Square (402340 KS)

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2026 High Conviction Idea: SK Inc

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Identifying the SK Square Vs. Hynix Price Ratio Reversion Alpha Setup

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