[Click eStock] "Korea Financial Group, Notable for High Capital Efficiency"

Daishin Securities Report

[Asia Economy Reporter Minji Lee] Daishin Securities maintained a buy rating and a target price of 110,000 KRW for Korea Financial Group on the 8th.

Last year's annual profit, including equity-method gains from KakaoBank (554.6 billion KRW), reached 1.76 trillion KRW, a 104% increase compared to the previous year. Even excluding one-time gains, the return on equity (ROE) stood at 1.75%, demonstrating high capital efficiency.

Hyejin Park, a researcher at Daishin Securities, stated, "The lock-up period on the 27.26% stake in KakaoBank held by Korea Financial Group and Value Asset has been lifted. The sanctions related to Korea Investment & Securities' past cartel violation of the Fair Trade Act are expected to be lifted this year, allowing Korea Investment & Securities to secure a major shareholder position."

However, the possibility of selling some shares during the change in shareholding structure cannot be ruled out. This is because the company does not gain significant business benefits directly from KakaoBank, except through stock accounts. Researcher Park analyzed, "Among large firms, it has the highest ROE, so it would be more advantageous to raise capital through share sales."

The company's net profit in the fourth quarter reached 304.9 billion KRW, exceeding market expectations of 219.2 billion KRW by 39%. The strong performance is attributed to better-than-expected BK fee income and IB revenue. Although the average daily trading volume decreased by 13.6% from 26.3 trillion KRW in the third quarter to 22.7 trillion KRW in the fourth quarter, overseas stock trading volume increased by 34.7% during the same period. BK fee income rose 3.4% year-on-year to 113.4 billion KRW, and IB-related revenue increased 5.2% to 134.4 billion KRW.

Researcher Hyejin Park explained, "The third quarter recorded the highest performance ever by participating in large IPOs such as KakaoBank, Hyundai Heavy Industries, and KakaoPay (acquisition group), so considering the seasonality of the fourth quarter, the results were quite favorable at an average quarterly level."

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