[Click e Stocks] SK Telecom, Enhancing Corporate Value After Demerger

[Asia Economy Reporter Hwang Junho] Korea Investment & Securities maintained the target price of SK Telecom at 360,000 KRW on the 11th. They believe that with SK Telecom's spin-off, the valuation of subsidiaries, which were previously assessed only based on operating value, will now be evaluated based on equity value, potentially enhancing the overall corporate value.

The SK Telecom board decided to spin off the company into a business company (the surviving company) operating AI, subscription services, data centers, and other businesses based on wired and wireless communication, and an investment company (the newly established company) responsible for investments in semiconductors, New ICT, and more. If approved at the shareholders' meeting on October 12, trading will be suspended from October 26 to November 26, and new shares will be listed on November 29. The split ratio between the business company and the investment company is 6 to 4. Additionally, SK Telecom decided on a 5-for-1 stock split to increase the number of circulating shares. Starting November 29, the par value per share will be lowered from 500 KRW to 100 KRW, increasing the number of circulating shares fivefold.

Korea Investment & Securities expects the value of growth stocks, which had been overshadowed by existing value stocks, to be highlighted. They anticipate that separating the growth subsidiaries, which had been a risk factor for investors wanting to invest in telecommunications and paid broadcasting, will have a positive effect. Furthermore, for investors seeking growth stock investments, separating telecommunications/paid broadcasting (accounting for more than 70% of sales), which had acted as inefficiencies, is evaluated positively.

Researcher Oh Taewan of Korea Investment & Securities stated, "Subsidiaries such as Wavve, 11st, and T map Mobility, which were previously evaluated based on operating value and did not receive proper valuation, can now be assessed based on equity value following the spin-off, potentially enhancing corporate value."

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