[Click eStock] "KT to Pay 1,700 Won Dividend This Year... Fulfilling Promise Made 20 Years Ago"

[Asia Economy Reporter Ji Yeon-jin] Daishin Securities stated on the 14th that KT's operating profit is expected to exceed 1 trillion won this year, maintaining a buy rating and a target price of 40,000 won.

Kim Hoe-jae, a researcher at Daishin Securities, said, "KT's stock price was adjusted down by -0.7% last month due to the spotlight on the network outage issue, but key indicators and earnings forecasts remain stable, and the dividend attractiveness is high, so an increase in weighting is necessary in December."

KT's dividend is expected to be 1,700 won this year and 2,000 won next year. Researcher Kim emphasized, "Since KT's privatization, the dividend policy maintained for 10 years from 2003 was a payout ratio of over 50% or DPS of over 2,000 won. After dividends decreased from 2013 and resumed at 500 won in 2015, reaching 2,000 won next year is a meaningful achievement that fulfills the promise KT made 20 years ago when it was privatized."

As of October this year, KT's 5G penetration rate is 41.4%, maintaining first place for 16 consecutive months. Among the three major telecom companies, KT is the only one whose 5G market share is higher than its overall wireless market share. The advantage in 5G penetration has translated into monthly average revenue per user (ARPU) growth, which has been steadily increasing since the first quarter of 2019.

Additionally, KT has partnered with 'Disney+' for mobile services and is showcasing original content starting with through Studio Genie, which is also cited as a factor contributing to KT's ARPU increase. Since video traffic significantly impacts data upgrades, bundling Netflix and Disney+ fees with telecom charges is another factor driving ARPU growth.

KT's standalone operating profit is expected to increase by 24% year-on-year to 1.1 trillion won this year. Consolidated operating profit is forecasted at 1.5 trillion won. KT set a goal to achieve 1 trillion won in standalone operating profit in 2022 through the CEO conference last May, and it is expected to achieve this target ahead of schedule this year.

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