KT Soars on Joint Love Calls from Foreign and Institutional Investors

Rises to 28,000 Won After 2 Years
Expectations for Performance, Dividends, and Content Business
Up 8.85% This Month

[Asia Economy Reporter Song Hwajeong] KT has recently risen continuously, reaching the 28,000 KRW mark for the first time in two years since 2019.

According to the Korea Exchange on the 29th, KT reached an intraday high of 28,450 KRW on the 26th, setting a new 52-week high. KT has risen 8.85% so far this month.

Recent buying momentum from foreigners and institutions has driven KT's strength. Foreign investors have net purchased KT for seven consecutive trading days, and institutions have also bought for four consecutive days.

Expectations for improved first-quarter earnings acted as momentum. According to Hana Financial Investment, KT's first-quarter average revenue per user (ARPU) for mobile subscribers increased by 3% compared to the same period last year, raising expectations for ARPU growth of over 3% this year. Although marketing expenses are expected to increase by 10%, depreciation expenses are showing a stagnation trend, and consolidated operating profit is expected to grow by 7%.

Expectations for dividends are also high. Kim Hongsik, a researcher at Hana Financial Investment, explained, "Not only is the price-to-book ratio (PBR) low, but generally, telecommunications companies rarely record high expected dividend yields during periods of earnings improvement through ARPU increases. Recently, however, KT is recording a high expected dividend yield of around 6%."

Expectations for the content business are also growing. KT newly established a content-specialized company, ‘KT Studio Genie,’ earlier this year. Centered on Studio Genie, KT plans to consolidate media and content capabilities to build a value chain from investment, planning, production to distribution, and to pursue extensive cooperation and partnerships with domestic and international production companies and platforms. Choi Minha, a researcher at Samsung Securities, said, "KT is making this year the first year of transformation into a digital platform company and is accelerating the restructuring of its business portfolio focused on growth businesses," adding, "It is laying the groundwork for growth in media, content, and business-to-business (B2B) sectors, while the wireless business will show stable profit improvement through 5G subscriber growth and ARPU increases."

There is an opinion that the stock price has sufficient room for further rise. Researcher Kim said, "Since KT's stock price did not rise before the dividend increase, it is highly likely that the stock price will reflect the increase in KT's dividend per share last year in a lagging manner, so there is ample room for further rise," adding, "Considering that KT's stock price is expected to rebound to at least a 5% expected dividend yield level, a short-term rebound up to 32,000 KRW is expected."

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