South Korea

• FnGuide’s December MKF500 rebalance adds Wonik Holdings (030530) to the semis bucket, clearing screens for TIGER Semiconductor TOP 10 ETF, Korea’s largest sector ETF.
• October rebalance: Wonik IPS added at 5% weight, pulling ₩100B passive flows and ripping 15%+ as retail chased.
• For April rebalance, Wonik Holdings’ high volume lowers theoretical passive impact, but strong retail chasing could trigger Oct 2–style price action—definitely worth monitoring.

• It has been revealed that three Mirae Asset Group companies including Mirae Asset Securities, Mirae Asset Venture Investment, and Mirae Asset Capital combined invested US$278 million in SpaceX.
• Mirae Asset Group is the biggest Korean investor in SpaceX. Its investment in SpaceX is estimated to be about 2.3% of the total US$12 billion already received in SpaceX. 
• If SpaceX’s valuation reaches nearly US$1.5 trillion in the upcoming IPO in 2026, Mirae Asset Group companies’ investment returns in SpaceX could be more than 10x their original investments.

• Structurally, Square’s NAV trade still works. The Hynix stake alone implies a 60%+ discount, well above local norms, with policy tailwinds supporting long-term compression.
• Near term, Square’s NAV is a derivative of retail Hynix flows. Today was the first real unwind since the 10th, with retail net selling roughly 5x yesterday’s retail net-sell.
• Retail sold both, but Hynix again dominated the tape. Retail is range-trading ₩500ks, and that behavior is the key driver of Square’s short-term NAV inflection.

• In this insight, we provide an early look at the potential additions and deletions to KOSPI200 rebalance in June 2026.
• We provide 8 potential deletion candidates including Miwon Specialty Chemical (268280 KS), SeAH Steel Holdings (003030 KS), Asia Holdings (002030 KS), and Miwon Commercial (002840 KS).
• Eight potential additions in KOSPI200 in June 2026 are up on average 41.7% on average in the past six months, outperforming KOSPI in the same period. 

• Names outside the new tax regime may hike year-end payouts, with gov’t push boosting odds despite fuzzy timing, drawing local desk interest.
• With timing murky, local desks are targeting high-yield names, 25–40% FY25 payout, and ~10%+ DPS growth as prime candidates for year-end dividend hikes ahead of AGMs.
• Nine first-tier names (25–40% payout, <10% DPS growth, 3%+ yield) are prime dividend plays; five second-tier names (20–25% payout) need monitoring for potential Q4 expense tweaks.

• SemiFive confirmed its IPO price at 24,000 won, which was at the high end of the IPO price range. 
• A 43.9% of the total IPO shares are under various lock-up periods lasting from 15 days to 6 months. This is also a bullish sign. 
• Our base case valuation of SemiFive is implied market cap of 1.4 trillion won or target price of 42,349 won per share, which is 76% higher than the IPO price.

• In today’s Morning Views publication we comment on developments of the following high yield issuers: Hanwha TotalEnergies, Vedanta Resources.
• Hanwha TotalEnergies Petrochemical (HTP) is a vertically integrated petrochemicals producer in South Korea.
• The company produces a range of commodity chemicals, including base chemicals (olefins and aromatics), polymers (e.g. polyethylene and polypropylene) and energy products (jet fuel and diesel).

• Wonik PNE is a key South Korean manufacturer of battery formation and testing equipment, integral to the secondary battery production process for electric vehicles (EVs) and energy storage systems (ESS).
• The company exhibits a high-growth, high-risk profile, characterized by explosive revenue growth driven by the expanding battery market, but marred by significant volatility in profitability and negative cash flow.
• Strategic acquisitions and a focus on providing turn-key solutions for major global battery manufacturers like Samsung SDI, LG Energy Solution, and SK ON position it to capitalize on long-term EV and ESS demand, though investor caution is warranted due to cyclicality and execution risks.

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• “Effective immediately” matters for L2 exit timing and re-flag risk; KRX confirmed year-end announcement with instant rollout, making year-end the key flow inflection if big L2 names get exempted.
• Large caps (₩10tn+ market cap) pulled from market-warning universe, with L2 tagging now factoring relative outperformance, not just absolute price gains, to curb overuse.
• Of 33 L2 names, five KOSPI blue chips see re-flag risk drop after their mandatory 10-day lockup; near-term trades focus on timing these expiries for relief rallies and flow resets.

• Kim Dong-Won and Kim Dong-Sun decided to sell nearly 1.1 trillion won (US$750 million) worth of Hanwha Energy.
• Through this sale, Hanwha Energy’s value is estimated at approximately 5.5 trillion won. 
• This large scale stake sale could result in negative sentiment/impact on Hanwha Corp and Hanwha Systems. 

• US-Backed US$7.4bn smelter embeds Korea Zinc in US critical-minerals supply chains, lifting long-term strategic relevance and valuation floor.
• Shares eased after an initial spike as dilution, low JV ownership, governance litigation risk, and long-dated cash flows weighed on near-term sentiment.
• We retain a ₩2.1m TP (~30% upside), supported by TC recovery, rare-metals margins, buybacks, and partial governance-discount compression.

• In the past two years, E Mart Inc (139480 KS) has announced two tender offers of its affiliates including Shinsegae E&C (September 2024) and Shinsegae Food (031440 KS) (December 2025).
• We believe the next target of a tender offer by E-Mart could be Shinsegae Information & Communication Co (035510 KS) in 2026/2027. 
• We provide three main reasons why E-Mart may try to conduct a tender offer of Shinsegae I&C in 2026/2027.

• On 15 December, Korea Zinc (010130 KS) announced a large scale third party capital raise of 2.85 trillion won (US$2.2 billion). 
• Korea Zinc plans to issue 2.21 million new common shares (11.4% of current outstanding shares) at the issue price of 1,291,330 won per share (22.7% lower than current price).
• Korea Zinc announced a strategic partnership with the U.S. government and U.S.-based defense contractors to invest approximately 11 trillion won (US$7.4 billion) in constructing a critical minerals smelter in Tennessee, U.S.

• On 15 December, it was announced that E Mart Inc (139480 KS) is conducting a tender offer and delisting of Shinsegae Food (031440 KS).
• Tender offer price is 48,120 won (20% higher than the closing price on 12 December).
• Shinsegae Food is currently trading at very low valuations. It is trading at P/E of 5.3x, P/B of 0.4x, and EV/EBITDA of 1.5x based on 2026 consensus earnings estimates.

• US government–linked investment in a planned US smelter JV materially lifts Korea Zinc’s long-term strategic relevance and downside valuation floor, even though project cash flows are long-dated and execution-heavy.
• Near–medium term earnings remain supported by zinc TC recovery, structurally higher rare-metals margins (led by antimony and germanium), and treasury-share cancellations, driving improved EPS visibility.
• We raise our target price to ₩2.1m, reflecting partial governance-discount compression and a higher strategic multiple, while maintaining conservative assumptions on timing and returns.

• The UST curve twisted steeper on Friday, continuing the steepening trend following the Fed’s rate cut decision last Wednesday.
• The yield on the 2Y UST declined 2 bps to 3.52%, while the yield on the 10Y UST rose 3 bps to 4.18%.
• Equities fell on investor anxiety over AI stocks, after Broadcom provided a disappointing sales outlook. 

• In this insight, we discuss the top 12 Korean companies that could benefit from the SpaceX IPO in 2026.
• Share prices of 12 Korean companies that are beneficiaries of the SpaceX IPO are up on average 16.7% in the past one week versus KOSPI (up 1.6% in same period).
• SeAH Besteel Holdings is a potential supplier of specialty steel to SpaceX. Kencoa Aerospace provided rocket parts to SpaceX. Intellian Technologies partnered with SpaceX on its launch vehicle recovery experiment.

• Livsmed confirmed its IPO price at 55,000 won, which is at the top end of the IPO price range. Demand ratio was 232 to 1.
• A 98.8% of the IPO shares applied thought that the company’s value is 55,000 won or more.
• Our base case valuation of Livsmed is implied market cap of 2.3 trillion won or target price of 88,294 won per share, representing a 61% upside from the IPO price.

• Dominant Market Leader in a High-Growth Industry: Dunamu, through its flagship exchange Upbit, commands an estimated 80% of the South Korean cryptocurrency market, a region with high digital asset adoption. This entrenched position provides a significant competitive advantage and a strong platform for future growth.
• Strategic Expansion and Diversification: The company is actively pursuing growth beyond its core exchange business by expanding into blockchain services, non-fungible tokens (NFTs), and asset management. Furthermore, Dunamu is strategically expanding its global footprint, particularly in Southeast Asia, to capitalize on the growing international demand for digital asset services.
• Potential for Significant Value Unlock through Strategic Partnerships and M&A;: A potential stock swap with Naver Financial could create a fintech behemoth in South Korea, combining Dunamu‘s crypto expertise with Naver’s vast user base and payment infrastructure. This could lead to significant synergies and a potential U.S. Nasdaq listing, unlocking substantial value for shareholders.

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• In this insight, we discuss the price performance actions of 32 stocks that have been rebalanced in KOSPI200 in 2025.
• Among the 16 additions to the KOSPI200 index in 2025, the average share price performances are up on average 19.5% (3 months performance prior to the announcement dates).
• Among the 16 deletions to the KOSPI200 index in 2025, the average share price performances are down on average 13.5% (3 months performance prior to the announcement dates).

• After the market close on 11 December, Trillion Luck Group announced a tender offer of a 52.5% stake in Rothwell International Co (900260 KS).
• The tender offer price is 1,580 won per share, which is 58% higher than current price.
• There has not been a meaningful positive impact of keeping Rothwell publicly listed in Korea. It makes more sense to take the company private. 

• SNT Holdings (036530 KS) is issuing convertible bonds (CB) and exchangeable bonds (EB) totalling 148 billion won to improve its financial structure and secure funds for new business investments. 
• The investor in this CB and EB is IMM Credit & Solution (ICS), which will acquire the entire amount through a private placement.
• This additional capital raise could result in S&T Holdings potentially increasing its stake in Smec Co Ltd (099440 KS).

• SK Inc. operates as the holding company for South Korea’s SK Group, a major conglomerate with a diversified portfolio spanning energy, telecommunications, semiconductors, chemicals, and biopharmaceuticals.
• The company is strategically focused on four key growth areas: advanced materials, green energy, biopharmaceuticals, and digital technologies, actively investing to secure future growth engines.
• As a holding company, its financial performance is closely tied to the performance of its major subsidiaries, including SK Hynix, SK Innovation, and SK Telecom, making it a proxy for the broader South Korean industrial landscape.

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• Celltrion Inc (068270 KS) has reported 3Q25 result, with double-digit YoY growth in key parameters. Key parameters also improved sequentially. Stellar 3Q performance was powered by high-margin young products.
• In 4Q25, Celltrion is expected to achieve sequential revenue growth of at least 30%, the COGS ratio in the mid- 30% range, and the operating profit margin improving to 40%.
• Stable revenue from mature products and rapid growth from newly launched products should drive topline growth. With the merger effect ending in 3Q25, profitability should improve in 4Q.

• SK Hynix and SK Square hit L2 flags; cash-only until Dec 24. Margin off, >40% two-day rip triggers halt. L2 lifts if below T-5/+45%, T-15/+75%, and 15-day high.
• L2’s usually a non-event, but this time the margin freeze probably smacks Hynix harder. Key trigger is staying below the 15-day high: Hynix ₩587,000, Square ₩324,000.
• Govt set to roll out AI-semiconductor holdco deregulation this week, boosting AI holdcos like Square and juicing a near-term Square-over-Hynix trade opportunity.

• In 2026, one of the emerging investment themes will likely be the main value-chain suppliers to SpaceX which is gearing up for a huge IPO next year.
• Seah Besteel Holdings is expected to be one of the specialty steel suppliers to SpaceX. Seah is investing about US$155 million to build a special alloy plant in the US.
• In addition to SpaceX, Seah Besteel Holdings plans to gain additional major US customers including Boeing Co (BA US), Lockheed Martin (LMT US), GE Aerospace, and Pratt & Whitney.

• Dominant Market Leader in a High-Barrier Industry: NICE Information Service is the largest credit bureau in South Korea, an industry characterized by significant regulatory hurdles and network effects, affording it a strong competitive moat.
• Consistent Financial Performance and Shareholder Returns: The company has demonstrated a solid track record of revenue, net income, and EPS growth over the past decade, complemented by a consistent and growing dividend payout to shareholders.
• Attractive Valuation Relative to Global Peers: NICE trades at a significant valuation discount to its international counterparts like Transunion and Equifax, presenting a potential value opportunity for investors, contingent on its ability to sustain growth and profitability.

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• Dominant Niche Player with Strong Growth: Daihan Pharmaceutical is a leading manufacturer of intravenous (IV) solutions in South Korea, a market poised for steady growth driven by an aging population and increasing healthcare needs. The company has demonstrated a solid track record of revenue and net income growth, outpacing its negative market capitalization trend.
• Exceptional Shareholder Returns and Value Proposition: The company exhibits a robust dividend profile, with a strong yield and a 5-year dividend CAGR of over 17%. Valuation analysis reveals a significant discount compared to peers across key metrics like P/E, P/B, and EV/Sales, suggesting a potentially attractive entry point for value-oriented investors.
• Favorable Industry Tailwinds: The South Korean pharmaceutical market is projected to experience robust growth, with the intravenous solutions segment expected to expand at a CAGR of approximately 8.7% through 2030. This provides a supportive macro environment for Daihan’s core business operations.

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• E Credible is a dominant player in the niche market of corporate credit certification in South Korea, providing essential credit risk information on SMEs to large corporate clients for supply chain management.
• The company is poised to benefit from the growing trend of ESG (Environmental, Social, and Governance) integration in supply chains, having proactively developed ESG evaluation services for SMEs, which presents a significant long-term growth driver.
• Despite a challenging recent growth track record and sensitivity to economic cycles, the company maintains a strong financial position with a high net cash balance, a low-capex model, and a commitment to high dividend payouts, offering an attractive yield.

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• E World is a regional theme park operator in Daegu, South Korea, centered around its landmark 83 Tower. The company is facing severe financial headwinds, characterized by declining revenues, significant and widening net losses, and negative operating cash flows over the past three years.
• The company’s valuation presents a mixed picture. While traditional earnings-based metrics are meaningless due to losses, its Price-to-Book ratio is comparable to peers, suggesting a potential valuation floor based on its physical assets. The Smartkarma ‘Value’ score of 4/5 supports this view.
• The outlook is heavily dependent on a successful operational turnaround and a broader recovery in the regional tourism market. While the South Korean tourism industry shows strong growth prospects, E World‘s ability to capitalize on this trend remains uncertain given its deteriorating financial performance and intense competition.

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• ADR odds are tiny. Both Samsung and Hynix have thin control stakes, making governance risk too high. Neither is willing to chase a valuation pop at the expense of stability.
• Still can’t ignore it, since the ADR chatter is meaningfully swinging the pair trades. Samsung pref spread and Hynix/Square are both getting pushed around.
• ADR noise cooled today, but it can easily resurface and skew the setup. Treat as noise, but be ready to hit aggressive reversion trades when it pops again.

• According to numerous local media, SK Hynix is considering on listing its treasury shares (2.4% of outstanding shares representing 17.4 million shares) as ADRs.
• SK Hynix could cancel its treasury shares or list them as ADRs. The bigger bang for the buck will likely be to list them as ADRs. 
• By listing its shares as ADRs, the valuation gap between SK Hynix and other listed peers (such as MU and TSMC) could be reduced. 

• They’re maxing out M15X ahead of schedule, facing a fab gap until ’27, and now need more capex than their KRW 28tn cash pile comfortably covers.
• SK doesn’t want an Hynix ADR; they’re focused on tapping the KRW 150tn Growth Fund to fill the capex gap while avoiding dilution and protecting their already-fragile control stack.
• ADR noise spiked because Hynix’s near-term capex needs exceed Growth Fund capacity, pushing them toward a 2.4% treasury dump—but I still don’t see SK pulling the ADR trigger.

• In this insight, we discuss a pair trade between Coupang (CPNG US) (short) and CJ Logistics (000120 KS) (long).
• There are six major factors that have negatively impacted Coupang in the past several weeks including a massive data breach, loss of customers, and potential ban on early dawn deliveries. 
• Coupang’s daily active users (DAU) were 16.2 million as of 5 December, down by 1.8 million (10%)  from 18 million as of 1 December.