[Click eStock] "Samsung Securities, Focus on Future Performance Over Q4 Results"

Korea Investment & Securities

[Asia Economy Reporter Song Hwajeong] Korea Investment & Securities maintained a 'Buy' rating and a target price of 50,000 KRW for Samsung Securities on the 10th, viewing the earnings improvement trend as valid.

Samsung Securities' Q4 earnings last year fell short of market expectations due to a decrease in operating profit. Baek Doosan, a researcher at Korea Investment & Securities, analyzed, "Samsung Securities' Q4 net income attributable to controlling interests was 126.7 billion KRW, missing the consensus by 18%," adding, "Other segments met expectations, but operating profit was weaker than estimated."

Samsung Securities' Q4 net brokerage commission was 188.6 billion KRW, down 11% from the previous quarter due to a decrease in trading volume and commission rates. Financial product sales revenue was 94.4 billion KRW, a 55% decline from the previous quarter. Researcher Baek explained, "This is due to the base effect from a significant increase in derivative-linked securities revenue in the previous quarter," and added, "Operating profit and financial balance were 61.8 billion KRW, down 55% from the previous quarter, likely due to changes in the valuation method of equity-linked securities (ELS) and a decrease in bond management performance."

Although Q4 was weak, the earnings improvement trend is expected to be valid this year. Researcher Baek said, "Earnings rebound is expected to resume from Q1 this year," and added, "Net brokerage commissions will improve due to increased trading volume, and financial product sales revenue centered on ELS is expected to perform well due to favorable global stock market conditions."

Korea Investment & Securities projected Samsung Securities' net profit this year to increase by 26% year-on-year to 638 billion KRW.

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