[Click eStock] "Finally Met: Telecommunications and Automobiles... KT to Excel in Autonomous Driving and 6G"

[Asia Economy Reporter Myunghwan Lee] Daishin Securities announced on the 8th that it maintains a Buy rating and a target price of 52,000 KRW for KT. Regarding the share swap between KT and Hyundai Motor Group announced the previous day, the company evaluated that it would contribute to the activation of autonomous driving and urban air mobility (UAM).

KT and Hyundai Motor Group disclosed on the 7th that they decided to exchange shares to revitalize future mobility businesses. Hyundai Motor and Hyundai Mobis will acquire 12,011,143 and 8,094,466 shares of KT, respectively, for 445.6 billion KRW and 300.3 billion KRW. As a result, Hyundai Motor and Hyundai Mobis's KT shareholding ratios increased to 4.7% and 3.1%, respectively. KT also announced that it will acquire 2,216,983 shares of Hyundai Motor for 445.6 billion KRW and 1,383,893 shares of Hyundai Mobis for 300.3 billion KRW. After acquisition, KT's shareholding ratios will rise to 1.04% and 1.46%, respectively.

Daishin Securities analyzed that the background of Hyundai Motor partnering with KT was influenced by autonomous driving technology and satellite ownership. KT had already conducted a pilot operation of an autonomous bus using the 28GHz band frequency at the 2018 Pyeongchang Winter Olympics. Regarding collaboration between companies, it was mentioned that exchanging shares mutually is more effective than a simple memorandum of understanding (MOU), and KT's holding of treasury shares made the share swap with Hyundai Motor Group possible.

It is also analyzed that KT has strengths in 5G and 6G mobile communications, which are essential elements for autonomous driving and UAM. KT has maintained the No.1 5G penetration rate for 25 consecutive months. For 6G, scheduled for commercialization around 2030, satellite utilization is necessary, and Daishin Securities explained that KT is the only domestic telecommunications operator owning satellites. KT is the only domestic satellite operator owning a total of five satellites: Mugunghwa 5, 6, 5A, 7, and KOREASAT 8. Based on this, Daishin Securities expects KT to also stand out in 6G.

Daishin Securities evaluated that considering the core of autonomous vehicles is a fast response speed within 1ms achievable with 5G or higher, collaboration between telecommunications companies and automobile manufacturers is essential. Researcher Kim Hoejae of Daishin Securities said, "The collaboration between KT, the leader in 5G with the No.1 penetration rate for 25 months, and Hyundai Motor Group, a global top-tier company beyond Korea, will greatly contribute to the activation of the autonomous driving and UAM markets."

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