South Korea

• SK Hynix announced a major treasury shares repurchase and cancellation of about 40 trillion won ($29 billion), representing about 3.3% of outstanding shares. 
• SK Hynix plans to return more than 50% of the cumulative free cash flow (FCF) generated during 2025-2027E to shareholders.
• In terms of trading implications in the next several weeks, this could positively boost SK Hynix’s share price back to about 2,200,000 won level (about 40-50% upside).

• Local chatter now points to Samsung announcing shareholder returns as early as Friday, driven by government pressure and Hynix’s more aggressive buyback.
• Samsung is expected to split its 50% FCF return into two tranches: KRW 40-50T from late August, then roughly KRW 50T in early 2027, led by buybacks and special dividends.
• Samsung’s special dividend record date should remain September 30, with Q3 regular and special dividends likely approved together at the late October board meeting.

• SPV Realty Fine (formed by Stonebridge Capital and LS Securities (078020 KS)) have launched a Tender Offer to acquire 30% of Refine (377450 KS), a B2B real estate risk/document-checking outfit. 
• Realty Fine is offering ₩17,600/share, a 30% premium to undisturbed, but below Realty Fine’s 1Q25 ₩27,159/share acquisition to secure control. This process is not lost on activist Must Asset Management.
• A successful Tender offer will increased Realty Fine’s stake in Refine to 77.96%. All shares tendered will be acquired. Realty Fine (unusually?) intends to maintain Refine’s listing. 

• On 18 August, WSJ reported that the Donald Trump wants to meet North Korea’s Kim Jong-Un as soon as this fall.
• There is a trade involving this event which is to go long on a basket of stocks related to North Korea reconciliation leading up to meeting between Trump and Kim.
• I provide a list of 10 Korean stocks that could benefit from a reconciliation with NK. A key risk with this trade is if Trump and Kim never meets again.

• CVC Capital’s 300 billion KRW strategic investment represents a significant step forward for international expansion. Beyond capital, the primary value is the direct access to Douglas, Europe’s largest specialist beauty distributor. This partnership is designed to establish direct B2B revenue channels, mitigating the historic headwind of lacking direct transaction history with major European retail networks.
• Silicon2’s structural hedge against “brand migration” (e.g., successful brands like APR or COSRX moving to direct-to-consumer or being acquired) lies in its core capability to rapidly source and incubate emerging indie brands. Supported by Korea’s flexible OEM/ODM ecosystem, the platform maintains a highly diversified portfolio where no single brand’s departure can permanently derail growth.
• Operating elasticity and margin defense are highly resilient. Despite rising global logistics headwinds, such as air freight costs increasing to 3.4% of revenue in Q2 2026, Silicon2 successfully restored its operating profit margin to 20.6%. This margin profile is protected by a strong USD/KRW exchange rate tailwind—with over 80% of sales denominated in USD—and high pricing elasticity on premium-tier indie beauty products.

• Korean retail spent US$840mn on SK Hynix ADRs in July — at up to 60% above the identical Seoul share — and ignored Samsung at home in the same breath.
• This is venue distrust, not a change of thesis. The Infosys ADR hit a 135% premium in 2000; it took 3–5 years to compress. TSMC’s never has.
• Remain BULLISH on both names; FVs unchanged. Own the South Korean mother share. The ADR premium is a sentiment gauge, not an investment.

• Private equity firm Stonebridge Capital and LS SECURITIES Co Ltd (078020 KS) are launching a tender offer for a 30% stake in Refine Co Ltd (377450 KS).
• Tender offer price of 17,600 won is 29.6% higher than the closing price on 14 August and reflects a 50.1% premium over the weighted average stock price of past month.
• I have a positive view on this tender offer. Clearly, the company is not doing enough to improve shareholder returns (net cash is 67% of market cap)

• Solidigm’s Financial Paradox: Despite a spectacular operational turnaround in H1 2026, reporting a net profit of KRW 5.8 trillion driven by booming enterprise SSD (eSSD) demand, Solidigm remains severely financially constrained by a debt-to-equity ratio of 4,484%. A potential Nasdaq IPO is facing intense public backlash from minority shareholders and corporate governance watchdogs, with a 70% to 80% probability that SK Hynix will postpone or cancel the listing.
• HBM Packaging Moat and the Stacking Battle: SK Hynix retains a clear, yield-driven competitive advantage in HBM3e with its proprietary Advanced MR-MUF technology, yielding 75% to 85%. While Samsung’s Advanced TC-NCF is closing the gap with yields reaching 60% to 65%, and Micron is scaling up 12-high HBM3e production, SK Hynix’s deep trilateral integration with TSMC and Nvidia provides a substantial time-to-market advantage heading into HBM4.
• The Cyclical Trap vs. Structural Cash Flow: Despite posting a historic Q2 2026 operating margin of 76% (operating profit of KRW 60.5 trillion), SK Hynix’s stock faces compression, trading at approximately 5 times next year’s earnings. This is driven by legacy DRAM/NAND pricing plateaus following massive Q1 surges, and market concerns over capital expenditure plans exceeding $31 billion in 2026 leading to future oversupply.

• Silicon2 (257720 KS) has secured a third party allocated capital increase worth 300 billion won (representing 10.3% of market share) from CVC Capital private equity firm.
• Silicon2 plans to use the capital for working capital to expand its global logistics infrastructure and increase its market share overseas.
• The company’s excellent sales growth and profit margins in the past year have been able to reduce concerns about the U.S. tariffs.

• The Kakao Mobility U.S. ADR approval on August 17, 2026, is a defensive maneuver forced by a 2017 shareholders’ agreement with the TPG consortium. TPG held a contractual provision to seize management control if an IPO failed, and with South Korea’s new July 2026 FSC regulations effectively blocking domestic dual-listings, the Nasdaq ADR route became the only viable exit path.
• Kakao is demonstrating superior capital discipline over Naver by deliberately avoiding capital-intensive AI infrastructure (GPUs, data centers). Instead, Kakao is focusing on consumer-facing “agentic AI” (the Kanana platform) and partnering with asset-heavy players like Coupang Eats under an Agent-to-Agent (A2A) model. This strategy drove a 36% year-over-year surge in Q2 2026 operating profit to KRW 277 billion, contrasting sharply with Naver’s stagnant operating margins.
• Regulatory headwinds have permanently impaired Kakao’s monetization ceilings in mobility and fintech. The May 2026 Passenger Transport Business Act amendment, which banned franchise fees on loitering street-hails, immediately vaporized an estimated KRW 30 billion in high-margin annual revenue. This forces the group to rely almost exclusively on high-margin, zero-CAC advertising channels within KakaoTalk to sustain its growth targets.

• Sponsor-Driven Consolidation and Delisting Risk: Realty Fine (the SPC backed by Stonebridge Capital and LS Securities) launched a cash tender offer on August 18, 2026, for a 30.00% stake in Refine at ₩17,600 per share, aiming to lift its stake to 77.96%. Despite formal filings claiming they intend to maintain the listing status, the structural reality—coupled with a tiny post-transaction free float and intense friction with activist second-largest shareholder Must Asset Management—points toward a high probability of eventual voluntary delisting.
• Inefficient Cash Fortress as a Governance Weapon: Refine maintains an exceptional net cash position, with ₩179 billion sitting in idle short-term financial instruments as of Q1 2026, representing approximately 67% of its market capitalization. This cash pile has been a point of extreme corporate governance conflict, characterized by the board’s issuance of a controversial 6.00% Exchangeable Bond (EB) directly to the sponsor, which was rapidly converted to equity to block activist maneuvers and is currently the subject of an ongoing lawsuit.
• Fragile Monopolistic Moat Tied to Jeonse: Refine commands an over 90% market share in the Korean rental-deposit (jeonse) title research market. However, this monopoly is highly exposed to macro housing policy and regulatory changes. Structural shifts in the rental market, such as the transition from jeonse to monthly rent (wolse) triggered by systemic fraud events, and HUG’s reduction in deposit guarantee coverage directly limit Refine’s transactional volume and pricing power.

• Hyundai Corporation Holdings (KOSPI: 227840, 현대코퍼레이션홀딩스) collects a fee every time somebody sells a generator, a power tool or an air conditioner under the HYUNDAI logo somewhere outside Korea.
• It also owns a quarter of a ₩8.7 trillion trading house, imports frozen meat, makes cardboard boxes in Cambodia and grows shiitake mushrooms in Lancashire.
• The whole thing is worth ₩122.2bn (US$86m) and no broker has published a report on it since May 2021.

• Hanwha Solutions (009830 KS) has been downtrending since April 2026 (after peaking in Feb 2026). In the last 2 weeks the stock staged a strong rally, potentially a directional change.
• The rally has been triggered by a combination of strong Q2 earnings and leadership confidence affirmed via Vice Chairman Kim Dong-kwan acquisition of 23,153 additional shares.
• After the 17th August holiday, the stock pulled back slightly on August 18th, it may be worth considering entering LONG position on this pullback (speculative trade).

• In the past few weeks, there have been increased market chatters about the potential IPO of Solidigm, a U.S. subsidiary of SK Hynix (000660 KS).
• I would put a 70-80% probability that SK Hynix CANCELS Solidigm IPO. I also think market is increasingly thinking that SK Hynix is not going to proceed with this IPO. 
• What makes this decision so challenging for SK Hynix’s management team is the pressure from potential pre-IPO investors in Solidigm that may demand an IPO soon. 

• On 17 August, it was reported that Kakao Mobility’s BOD has approved a plan to issue ADRs.
• The primary reason for this is so that the TPG consortium (Kakao Mobility’s second largest shareholder) could sell some of its stake in the company.
• If Kakao Mobility achieves a high valuation on NASDAQ, this could actually positively impact both Kakao Mobility and Kakao Corp. 

• Hynix could announce KRW 100tn shareholder returns this week, with a 60:40 dividend buyback mix. Yeouido is increasingly positioning for this outcome.
• KRW 40tn buyback matches the ADR proceeds, with Hynix repurchasing below the issuance price. The broader package also creates a timely window to upstream excess cash to SK.
• Square looks set to outperform Hynix near term as the return mix reinforces the cash upstreaming narrative. A long Square, short Hynix or market setup looks compelling into the announcement.

• We present a WEEKLY tactical global macro recap/analysis for several markets and stocks we track, grouped by sector.
• We apply our quantitative models to each instrument’s trend, to determine which stocks/markets are just starting a trend, are in the middle of it, or are about to end it.
• Tencent is oversold, while KOSPI 200 , Nikkei 225, Hitachi Ltd, Samsung Electronics, SK Hynix, Advantest Corp, Hanwha Solutions, GLD are overbought. Details per sector are displayed in the insight.

• Samsung Electronics (005930 KS) stabilised in the first half of August, gaining 4.6%, while the 2x Leveraged Index rose 6.8%.
• Despite the rebound, leveraged ETFs recorded KRW 372bn of net outflows, reducing combined AUM by 2% in August MTD.
• Investor flows—not performance alone—are driving AUM. Their effect on demand for Samsung shares may be amplified or offset by the ETFs’ daily leverage rebalancing.

• This is our inaugural issue of Korea Corporate Value Up Weekly. There were 12 companies in Korea that provided corporate value up announcements in the past week (ending 14 August).
• Corporate governance improvement is one of the most important factors among companies in Korea. By closely tracking these announcements in more detail, this could potentially result in extra alpha generation. 
• Among these 12 companies, two of them outperformed KOSPI which included GS Holdings (078930 KS) (up 18.3%) and Shinsung Eng (104110 KS) (up 11.6%). 

• Infovine has one of the largest percentages of treasury shares as percentage of outstanding shares in Korea. Currently, it has 7.51 million treasury shares, representing 50.6% of outstanding shares. 
• Due to the mandatory treasury shares cancellation under the amended Commercial Act, there is a high probability that Infovine will cancel a large percentage of remaining treasury shares in 2027. 
• The company has consistent record of generating positive free cash flow, net cash as percentage of market cap is 55%, and operating margins is 20%+. 

• The $26.5 Billion ADR Premium Arbitrage is Mathematically Viable but Cyclically Dangerous: While SK Hynix could theoretically buy back cheaper local shares in Seoul to restore SK Square’s 20.0% ownership floor and then reissue them on Nasdaq at a premium, doing so at a cyclical high of 1.6 million won introduces severe capital misallocation risks if the memory cycle turns.
• Corporate Governance Remains a Primary “Korea Discount” Catalyst: The recent $380.3 million acquisition of a Penguin Solutions stake from SK Telecom at nearly double its original cost proves that despite its 76% operating margin and 69.4 trillion won net cash position, SK Hynix is still utilized as a balance sheet “cash cow” to benefit SK Group’s ultimate parent company, SK Inc., where the controlling family has a far higher economic interest.
• Dual-Listing Tensions and Structural Shift in DRAM Margins: The Financial Services Commission’s new dual-listing guidelines implemented on August 3, 2026, present hurdles for Solidigm’s rumored 5 to 10 trillion won pre-IPO, while rising conventional DDR5 pricing to $20/GB is eroding HBM’s margin premium, shifting near-term profitability advantages back toward Samsung and Micron.

• Asia Cement is a key player in the South Korean cement industry, currently facing significant headwinds from a domestic construction downturn. The company’s financial performance reflects this, with declining revenue and net income over the past three years.
• The company exhibits strong value characteristics, trading at a significant discount to its book value (P/B of 0.3). This valuation may present a margin of safety for investors, though it is contrasted by weak growth metrics and negative free cash flow.
• The outlook for the domestic market remains challenging, with cement shipments at a 34-year low. Management is seeking to offset this by increasing exports, but this strategy offers limited profitability due to high transportation costs. Long-term growth will be tied to the recovery of the South Korean construction sector and government infrastructure spending.

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• After losing 58% of its value from its peak at the end of June, SK Hynix (000660 KS) started a recovery and it may close this week up.
• If confirmed on Friday, this would be the stock first weekly positive close since June 19th, roughly 2 months ago.
• This insight leverages our model to assess whether SK Hynix‘s current trend pattern indicates the start of a new rally or merely a dead cat bounce.

• Back on the 29th June, Golfzon Holdings (121440 KS)‘s largest shareholder Kim Won-il (via SJ Investments) launched a tender offer for the remaining 36.15% of Golfzon not owned, at ₩6,700/share.
• At 0.35x P/B, it was an egregiously low-balled bid. Kim secured 62.9% of the target volume in the tender offer, increasing his stake to 76.85% from 55.36% (85.2% excluding treasuries).
• Undeterred, Kim has reloaded. At the same ₩6,700/share Offer Price. Trading almost at terms. This Tender closes on the 2nd September. Do not tender. Hold off for a bump. 

• Korea Industrial is a key player in the South Korean animal feed market, with secondary operations in corrugated packaging and other materials. The company’s financial performance has been marked by significant net income growth in recent years, though revenue has remained relatively flat.
• The company faces a highly competitive and fragmented market, with larger, more integrated players like Harim Co., Ltd. posing a significant challenge. Its future growth is closely tied to the stable, albeit slow-growing, South Korean livestock and meat consumption trends.
• Valuation appears attractive compared to peers on a Price-to-Book basis, but key risks include volatility in raw material costs, potential for livestock disease outbreaks, and ongoing competitive pressure limiting margin expansion.

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• KRX Administrative Designation on August 13, 2026, due to “penny stock” (주가 미달) status is CMG’s primary existential crisis. The company’s share price fell below the 1,000 KRW threshold for 30 consecutive trading days, triggering the alert under the newly-tightened listing maintenance rules. To combat this, management is pushing a defensive 10-to-1 reverse stock split (주식병합) at a special general meeting on September 2, 2026, though historical precedents suggest this rarely solves the underlying valuation destruction.
• The company’s capital is being heavily drained by CHA Group’s grand, non-core strategic ambitions, particularly the 150 billion KRW Pangyo Cell Gene Biobank (CGB) project. CMG is carrying a disproportionate 40% funding burden for this CGT CDMO facility, forcing it to take on 41.5 billion KRW in long-term borrowings in Q1 2026, which has ballooned its liabilities to 117.6 billion KRW and severely strained its balance sheet.
• Commercialization of its FDA-approved schizophrenia film drug, Mezofy, remains stalled 16 months post-approval. Despite securing FDA clearance in April 2025, commercial launch is delayed due to pricing negotiations and US partner securing hurdles, while the domestic business has been decimated by an outsourcing transition to CSOs, driving service fees (지급수수료) to a staggering 43.2 billion KRW in FY2025 and generating a 2.9 billion KRW operating loss in Q1 2026.

• ADR chatter is building for October, but there is still no solid Yeouido read. Political, regulatory and Square 20% constraints make an aggressive buyback plus ADR primary a tough call.
• Base case remains a late execution for the special dividend and buyback, preserving flexibility around FCF volatility rather than committing to an aggressive schedule upfront.
• We should assign low odds to Hynix front loading the buyback and executing aggressively within a tight window to facilitate a new ADR issuance.

• Since 2x leveraged ETFs linked to SK hynix (000660 KS) launched in late May, volatility in the underlying stock has increased significantly.
• Although daily rebalancing can amplify price moves, the data do not indicate that it does so systematically.
• Overnight and intraday returns are largely uncorrelated across the sample, although they tend to reinforce each other on days with extreme moves.

• I provide an update of the potential KOSPI200 rebalance candidates in December 2026.
• The bottom 5% market caps in KOSPI200 could be excluded from the KOSPI200 rebalance in December 2026. These 10 stocks are down on average 24.5% YTD vs KOSPI (up 56.1%).
• I also provide five potential inclusion candidates which are up on average 57.6% YTD. 

• On 12 August, the KRX designated 36 companies as administrative issues for potential delisting for failing to meet share price and market capitalization standards. 
• They could potentially be delisted. There are potential trading opportunities among these 36 stocks.
• The key is to be on the lookout for companies with decent balance sheets that are willing to improve their corporate governance.

• We remain bullish (as of our 4/21/26 Compass) on the S&P 500 (SPX), Nasdaq 100 (QQQ), and Russell 2000 (IWM). 
• Additionally, we continue to believe the bottom is in for SPX, IWM, QQQ, and Technology areas (XLK, IGV, SOXX, CHAT).
• With that said, some mixed price action in A.I. themes — notably semiconductors (SOXX), generative A.I. (CHAT), memory (DRAM), and neoclouds (WGMI) — are giving us some reason for pause.

• TSE is a key supplier of semiconductor test solutions, specializing in probe cards and interface boards, poised to benefit from the long-term growth in chip complexity and demand from AI, 5G, and automotive sectors.
• The company is demonstrating strong growth momentum, with a significant revenue increase in the most recent fiscal year and a positive outlook, further bolstered by the potential for substantial passive fund inflows from its anticipated inclusion in the KRX Semis index.
• While valuation appears reasonable compared to some high-flying peers, the company operates in a highly cyclical industry, faces intense competition, and has shown volatility in profitability and cash flow generation.

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• KRX says it will strictly follow methodology for September KRX Semis, with no special review, pointing to another sharp cut in constituents, potentially down to the 20 name floor.
• At 20 constituents, TES (095610) and TSE (131290) would be the two additions and face limited risk of failing the concurrent TMI eligibility screen.
• With KRW 6.6tn AUM, the constituent cut should drive outsized passive flows into TES and TSE, while surviving names also see meaningful inflows, making a basket trade worth considering.

• Amid the recent “bear market” in Korea in past two months, one of the noticeable trends has been the outperformance of many Korean preferred stocks relative to their common counterparts.
• More investors are seeking value-oriented stocks amid increased debate about how much longer the global semiconductor cycle could rally.
• The share prices of 15 major preferred stocks in Korea are down on average 6.5% in the past two months, outperforming their common shares counterparts (down on average 13.2%)

• Sephora recently announced that 19 OLIVE YOUNG curated Korean cosmetic brands will become available at 500+ Sephora stores in the U.S. and at Sephora.com.
• Unlike the semiconductor sector where the industry cyclicality is highly volatile, the global consumers’ preference for Korean cosmetics could well last much longer for the next 3-5 years. 
• Korean cosmetics exports reached a record high of $7.0 billion in 1H 2026, up 27.3% YoY. The primary export destinations were the US at $1.45 billion (up 41.5% YoY).

• The primary transition of control at LX Holdings is complete with yesterday’s (August 10, 2026) transfer of 6.1 million shares (7.85% stake) from Chairman Koo Bon-joon to President Koo Hyung-Mo. This raises Koo Hyung-Mo’s stake to 19.77%, cementing his position as the largest shareholder and confirming that the family is adhering to the traditional LG-era rule of primogeniture succession, bypassing the Chairman’s daughter.
• President Koo faces an estimated 28 billion won gift tax liability, which will shape the group’s capital and structural maneuvers over the next five years. To fund the annual installment payments of roughly 5.6 billion won, LX Holdings must keep dividends elevated, putting immense pressure on underlying cash flows from LX Semicon, LX Hausys, and LX International.
• With the gift finalized, the legacy structural discount strategy has served its tax-minimization purpose, opening the door for active “Corporate Value-up” initiatives. Investors should expect targeted restructurings, including a potential merger of Koo Hyung-Mo’s advisory vehicle LX MDI with the holding company, and renewed pressure to list unlisted logistics cash-cow LX Pantos once macro headwinds and dual-listing regulatory scrutiny ease.

• On 10 August, it was reported that Miri Capital, a U.S. based investment firm has invested in 15 Korean companies, of which 13 of them are listed in KOSDAQ.
• Some of the KOSDAQ listed companies invested by Miri include Gabia (24.2%), KINX (17%), Genians (15.1%), Korea Alcohol (12.9%), Mico (11.1%), Gaesoft (10.2%), and Makus (9.9%). 
• Increased foreign investors such as Miri Capital that are interested in investing in high quality, overlooked small and mid cap stocks in KOSDAQ could positively impact the KOSDAQ exchange.

• On 10 August, it was reported that Koo Hyung-mo, President of LX MDI, has become the largest shareholder of LX Holdings (383800 KS). 
• President Koo Hyung-mo’s stake in LX Holdings increased from 12.15% previously to 20.15%. Chairman Koo Bon-joon’s stake decreased from 20.37% to 12.38% following the gift.
• My NAV valuation suggests an implied market cap of 848 billion won or target price of 11,107 won per share, which represents a 39% upside from current levels.

• Kakao Mobility is the undisputed leader in South Korea’s mobility market, commanding a market share of over 90% in the ride-hailing segment through its comprehensive ‘Kakao T’ super-app.
• The company is diversifying its revenue streams beyond ride-hailing into higher-margin areas such as parking, premium taxi services, and B2B solutions, while also investing in future growth drivers like autonomous driving and AI-powered logistics.
• Significant regulatory scrutiny, including allegations of anti-competitive practices and accounting fraud, coupled with pressure from major financial investors for a liquidity event, presents considerable uncertainty, with a potential Nasdaq listing being explored as a strategic option.

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• Bionote is a South Korean company specializing in in-vitro diagnostic products for animals, with a growing presence in the global market.
• The company’s financial performance has been significantly impacted by the post-pandemic decline in demand for COVID-19 related products, leading to a strategic shift towards its core animal diagnostics business.
• Future growth is expected to be driven by the expanding animal health market, new product launches, and geographic expansion, particularly in the U.S. and other developed markets.

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• Dongsuh Companies holds a dominant position in the South Korean instant coffee market through its joint venture, Dongsuh Foods, which commands a market share of over 80% with its flagship ‘Maxim’ brand.
• The company demonstrates strong financial resilience, characterized by consistent profitability and robust operating cash flow, supporting a generous and growing dividend policy.
• While the core instant coffee market is mature and facing challenges from a growing cafe culture and capsule coffee, Dongsuh is strategically pivoting towards premium instant coffee, ready-to-drink (RTD) beverages, and the capsule market to capture evolving consumer preferences.

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• Strategic Repositioning for Global Growth: Dongwon F&B is undergoing a significant corporate restructuring to be delisted and fully integrated into its parent, Dongwon Industries. This move is designed to streamline operations, create synergies, and aggressively pursue global expansion, with a target of increasing overseas sales from 22% to 40% of total revenue by 2030.
• Diversification Mitigating Commodity Risk: While historically known for its dominant canned tuna business, the company has successfully diversified its portfolio into higher-growth areas like Home Meal Replacements (HMR), dairy, beverages, and pet food. This strategy, coupled with recent large-scale facility investments, is reducing earnings volatility associated with fluctuating tuna prices.
• Solid Financial Performance and Attractive Valuation: The company has demonstrated consistent revenue and net income growth over the past several years. Despite this strong performance, it trades at a compelling valuation relative to its peers. However, investors should monitor the recent trend of negative free cash flow, which is largely attributable to significant capital expenditures for future growth.

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• Strategic Repositioning Amid Industry Headwinds: Dongkuk Steel is navigating a challenging steel market by focusing on high-value-added products, expanding its export footprint, and enhancing shareholder returns. The company recently underwent a significant restructuring, separating its hot-rolled and cold-rolled businesses to improve management efficiency and business competitiveness.
• Attractive Valuation with Underlying Risks: The company exhibits strong value, growth, and momentum characteristics, reflected in a low price-to-book ratio. However, this is counterbalanced by low resilience, stemming from margin pressure and the inherent cyclicality of the steel industry. Financial performance has been volatile, with a notable decline in profitability from a 2023 peak.
• Focus on Shareholder Returns and Future Growth: Management has committed to a high dividend payout, signaling confidence in future cash flows. The company’s strategy involves increasing its export share from 11% to 15% to mitigate sluggish domestic demand and investing in future growth engines through a newly established corporate venture capital (CVC) arm.

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• Hanil Holdings is a major player in the South Korean cement industry, demonstrating strong shareholder returns through consistent and growing dividends, supported by high dividend and momentum Smartkarma scores.
• The company faces headwinds from a sluggish domestic construction market, which has negatively impacted revenue and net income growth in recent years. Future growth is linked to a recovery in the housing market and government infrastructure spending.
• Valuation appears attractive, with a low price-to-book ratio. However, the company’s growth outlook is closely tied to the cyclical nature of the domestic construction industry, presenting a key risk for investors.

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• Hanwha Corporation is a large South Korean conglomerate with a diversified business portfolio spanning aerospace, defense, chemicals, energy, financial services, and construction.
• The company is undergoing a strategic restructuring, including a planned spin-off of its Machinery & Service Holdings, to sharpen its focus on high-growth areas like technology and life solutions.
• While the company exhibits strong growth in its defense and aerospace segments, driven by increasing global demand, its overall financial performance is marked by revenue growth but volatile net income and fluctuating margins.

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• Strong Recovery and Growth Momentum: The company has demonstrated a significant financial turnaround, moving from a net loss in 2024 to strong profitability in 2025 and the first quarter of 2026, driven by a massive surge in revenue.
• Favorable Industry Tailwinds: South Korea’s tourism sector is experiencing a robust recovery, with international visitor arrivals in the first half of 2026 surpassing pre-pandemic levels, providing a strong demand backdrop for the company’s core hotel and hospitality assets.
• Attractive Valuation Relative to Peers: GS P&L trades at a notable discount to its peers on key valuation metrics such as Price-to-Book (P/B) and EV/Sales, suggesting a potential valuation gap and opportunity for re-rating.

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