Allin Partners Asset Management Proposes Auditor Appointment to SM Entertainment

[Asia Economy Reporter Jang Hyowon] Align Partners Asset Management announced on the 21st that it has proposed the appointment of an auditor to SM Entertainment (SM).

The auditor candidate is Kwak Junho, former Chief Financial Officer (CFO) of KCF Technologies. He is described as a financial management expert who has worked in GS Home Shopping's overseas business team, SK Hynix's finance team, and OB Beer’s treasury team.

The asset management firm explained, "SM sold a total of 17.31 million albums last year centered on NCT and EXO, surpassing HYBE (14.25 million albums) and JYP (6.44 million albums) to rank first in the industry," adding, "Despite these achievements, its market capitalization is less than one-sixth of HYBE’s."

They added, "This is mainly due to a decline in capital market trust caused by various factors such as frequent quarterly net income 'earnings shocks,' tax audits, large-scale related-party transactions with the largest shareholder, and the absence of shareholder return policies."

Therefore, the firm expects that appointing an independent and professional auditor recommended by external shareholders will help resolve this undervaluation phenomenon.

Lee Changhwan, CEO of Align Partners Asset Management, emphasized, "SM is a pioneer in the K-pop industry, leading the global Korean Wave and producing outstanding business results," but added, "However, there is a perception of shortcomings in governance, and as a result, it is not properly valued in the stock market."

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