Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

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).

<ul>
<li>There is an important upcoming change in regulation for land value disclosures in Korea. </li>
<li>Starting December year end companies' financials, the "officially assessed land values" (공시지가) will become mandatory in the financial footnotes.</li>
<li>I provide a list of 30 companies that could be key beneficiaries of the change in regulation for land value disclosures in Korea. </li>
</ul>


There is an important upcoming change in regulation for land value disclosures in Korea. 
Starting December year end companies' financials, the "officially assessed land values" (공시지가) will become mandatory in the financial footnotes.
I provide a list of 30 companies that could be key beneficiaries of the change in regulation for land value disclosures in Korea. 


Change in Disclosure of Land Value in Korea (Officially Assessed Land Value): Top 30 Beneficiaries

Event-Driven

Samsung Electronics Co., Ltd. manufactures a wide range of consumer and industrial electronic equipment and products such as semiconductors, personal computers, peripherals, monitors, televisions, and home appliances including air conditioners and microwave ovens. The Company also produces Internet access network systems and telecommunications equipment including mobile phones.

<ul>
<li>After the market close on 9 September, it was reported that Hong Ra-hee is selling a 0.11% stake in Samsung Electronics (worth 1.94 trillion won) to her son Lee Jae-yong. </li>
<li>Her decision to transfer the shares directly to Chairman Lee rather than selling them on the open market is seen as a move to minimize the impact on the market. </li>
<li>After this transaction is completed, Lee Jae-yong's stake in Samsung Electronics will rise from 1.47% to 1.58%. </li>
</ul>


After the market close on 9 September, it was reported that Hong Ra-hee is selling a 0.11% stake in Samsung Electronics (worth 1.94 trillion won) to her son Lee Jae-yong. 
Her decision to transfer the shares directly to Chairman Lee rather than selling them on the open market is seen as a move to minimize the impact on the market. 
After this transaction is completed, Lee Jae-yong's stake in Samsung Electronics will rise from 1.47% to 1.58%. 


Hong Ra-Hee Is Selling 1.9 Trillion Won of Samsung Electronics to Her Son Lee Jae-Yong

SK Hynix Inc. provides products and services for the electronic components industry. The Company manufactures semiconductors, such as dynamic random access memory (DRAM), NAND flash memory, and static random access memory (SRAM) chips.

<ul>
<li>In this insight, I provide a near-term trading strategy on Samsung Electronics and SK Hynix amid heightened competition from CXMT.</li>
<li>Prior to its 3Q 2026 conference call, I expect Samsung Electronics to trade in a box trading range of about 210,000 won to 240,000 won per share.</li>
<li>I also expect SK Hynix to trade in a box trading range of about 1,300,000 won to 1,520,000 won prior to the the 3Q 2026 conference call. </li>
</ul>


In this insight, I provide a near-term trading strategy on Samsung Electronics and SK Hynix amid heightened competition from CXMT.
Prior to its 3Q 2026 conference call, I expect Samsung Electronics to trade in a box trading range of about 210,000 won to 240,000 won per share.
I also expect SK Hynix to trade in a box trading range of about 1,300,000 won to 1,520,000 won prior to the the 3Q 2026 conference call. 


Trading Strategies on Samsung Electronics and SK Hynix Amid Heightened Competition from CXMT

Equity Capital Markets

DTS designs and manufactures air-cooled heat exchangers and condensers used in power and industrial sectors.

<ul>
<li>DTS finalized its IPO price at 18,500 won (high end of IPO price range). A total of 2,381 institutions participated in the demand forecasting. Demand ratio was 983.98 to 1.  </li>
<li>Based on the finalized offering price, the total proceeds from the IPO amount to approximately 41.2 billion won, and the company's expected market capitalization post-listing is around 275.3 billion won.</li>
<li>My base case valuation of DTS is a target price 29,360 won per share, which is 59% higher than the IPO price (18,500 won). </li>
</ul>


DTS finalized its IPO price at 18,500 won (high end of IPO price range). A total of 2,381 institutions participated in the demand forecasting. Demand ratio was 983.98 to 1.  
Based on the finalized offering price, the total proceeds from the IPO amount to approximately 41.2 billion won, and the company's expected market capitalization post-listing is around 275.3 billion won.
My base case valuation of DTS is a target price 29,360 won per share, which is 59% higher than the IPO price (18,500 won). 


Index Rebalance

SK hynix Inc. provides products and services for the electronic components industries. The Company manufactures semiconductors such as dynamic random access memory (DRAM), NAND flash memory, and static random access memory (SRAM) chips.

<ul>
<li>There are several notable ETFs (SMH ETF, VanEck Semiconductor UCITS ETF, and KODEX US Semiconductor ETF) that will include SK Hynix (SKHY US) ADRs in their upcoming rebalances.</li>
<li>The expected capital inflow from the passive funds is expected to be significant at about $3.8 billion (5.2 trillion won). </li>
<li>A $3.8 billion inflow represents 11.3% of the total ADR market cap. ADTV is $4.3 billion. Flow/ADTV (no of days) is 0.88. </li>
</ul>


There are several notable ETFs (SMH ETF, VanEck Semiconductor UCITS ETF, and KODEX US Semiconductor ETF) that will include SK Hynix (SKHY US) ADRs in their upcoming rebalances.
The expected capital inflow from the passive funds is expected to be significant at about $3.8 billion (5.2 trillion won). 
A $3.8 billion inflow represents 11.3% of the total ADR market cap. ADTV is $4.3 billion. Flow/ADTV (no of days) is 0.88. 


SK Hynix ADR Inclusions in the SMH ETF, VanEck Semi UCITS ETF, and KODEX US Semi ETF Rebalances

Nearly 30 years of experience in the Korean/Asian equity research. Major sectors coverage include the following:
- Technology 
- Consumer 
- Special Situations/Deep Value Plays
- Tender Offers/M&As
- Holdcos/Stubs
- Asian Unicorns/Private Companies