"KOSPI to Surpass 3000... Securities Firms Raise Next Year's Target Prices"

Shinhan Financial Investment Forecasts KOSPI Upper Range at 3150-3200 Next Year

[Asia Economy Reporter Minji Lee] As the domestic stock market reaches an all-time high, the securities industry is expressing opinions that the KOSPI will surpass 3000 next year.

According to the financial investment industry on the 20th, securities firms are revising their expected KOSPI fluctuation range for next year upward from the previous 2700-2800 level to above 3000. In October and November, securities firms suggested the upper limit of the expected KOSPI fluctuation range for next year to be 2700-2800, but this year the KOSPI is already on the verge of breaking through the 2800 level.

On the 7th, Shinhan Financial Investment forecasted the upper index range for next year to be 3150-3200 in a report. Researcher Songcheol Kang stated, "The domestic stock market, which has relatively well managed the novel coronavirus disease (COVID-19) and can benefit from the global economic recovery, will reduce the valuation discount compared to global markets."

He also predicted, "In a situation where there are few suitable investment targets due to low interest rates, the index's lower bound is expected to be higher than in the past because of more than 60 trillion won in standby funds for the stock market."

Hanwha Investment & Securities initially projected the KOSPI fluctuation range for next year as 2100-2700 in its year-end outlook report at the end of October but revised it upward to 2100-3000 on the 7th. Researcher Seungyoung Park explained, "Assuming a 10% upward revision of next year's net profit consensus, currently estimated at 128 trillion won, and applying a price-earnings ratio (PER) up to the historical peak of 13 times, we focus on foundry, battery, and electric vehicles as sectors that could raise the KOSPI's profit level."

Hi Investment & Securities also raised its KOSPI target for next year from 2760 in the mid-November annual outlook report to 3000. Researcher Ikjae Jo analyzed in a report released on the 11th, "We raised the KOSPI target because expected profits have rapidly increased since November. Considering that next year is the first time in eight years since 2013 that corporate growth will recover in a low-interest-rate environment, the PER should be raised above 11 times." Additionally, Daishin Securities (3080), Hyundai Motor Securities (3000), and Heungkuk Securities (3000) also set their KOSPI targets above 3000 for next year.

Global investment banks (IBs) are also raising their expectations. JP Morgan set the KOSPI target index at 3200 in a report published earlier this month. JP Morgan explained, "Optimism about the COVID-19 vaccine, visible recovery in corporate earnings, and increased weighting of healthcare and batteries among large-cap stocks support the upward revision of valuations."

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