"Mirae Asset Daewoo 'Strong Performance', Recovers to 8,000 Won Level After One Year"

Securities Stocks Weakened Under Pressure from Tax Reform Plan Burden

[Asia Economy Reporter Song Hwajeong] Mirae Asset Daewoo has recovered its stock price to 8,000 KRW after one year. Strong second-quarter earnings appear to have driven the stock price up.

According to the Korea Exchange on the 23rd, Mirae Asset Daewoo closed at 8,040 KRW the previous day. This is the first time since July 24 of last year that the closing price exceeded 8,000 KRW. During the previous day’s trading session, the price rose to 8,290 KRW, setting a new 52-week high. Mirae Asset Daewoo’s stock price has risen more than 20% just this month and has increased by 129% compared to the low recorded on March 19.

Expectations for strong earnings have driven the stock price. With trading volume increasing, securities firms’ second-quarter earnings are estimated to have significantly improved, and Mirae Asset Daewoo’s second-quarter results are expected to exceed market expectations. According to financial information provider FnGuide, the consensus for Mirae Asset Daewoo’s second-quarter earnings is KRW 536.3 billion in revenue, KRW 219.6 billion in operating profit, and KRW 190.4 billion in net profit. These figures represent decreases of 3.97%, 16.12%, and 12.82%, respectively, compared to the same period last year. Samsung Securities forecasts that Mirae Asset Daewoo will record a net profit of KRW 202.8 billion in the second quarter, surpassing the consensus. Jang Hyoseon, a researcher at Samsung Securities, said, “Brokerage revenue is expected to grow by more than 50% compared to the previous quarter, benefiting from increased trading volume as well as growth in overseas stock trading. The scale of Mirae Asset Daewoo’s overseas stock deposit assets, which was KRW 8.3 trillion in the first quarter, is estimated to exceed KRW 11 trillion by the end of the second quarter.”

The tax reform bill announced the previous day appears to be a burden on securities stocks. As of 9:30 a.m., the KOSPI securities industry index recorded 1,562.30, down 2.64% (42.30 points) from the previous day. Most securities firms are showing weakness. Mirae Asset Daewoo, which reached the 8,000 KRW mark the previous day, is showing a decline of more than 3% today, and Yuanta Securities and Hanwha Investment & Securities are also down more than 3%. Samsung Securities, NH Investment & Securities, Meritz Securities, and Kiwoom Securities have all fallen more than 2%.

Park Hyejin, a researcher at Daishin Securities, analyzed, “Although the stock capital gains tax exemption threshold was raised from KRW 20 million to KRW 50 million, the transaction tax remains, so controversy over double taxation cannot be avoided, and the criteria for the KRW 50 million financial investment income are also unclear.” Park added, “However, it is positive that the tax reform bill, which could have discouraged investment incentives in stock public offering funds, has been revised. This amendment is neither more nor less than a policy that provides some relief, and its impact on securities firms is neutral.”

This content was produced with the assistance of AI translation services.