[Click eStock] "KT, Recommends Box Range Trading for Now... Stock Price Expected to Rise Early Next Year"

[Asia Economy Reporter Myunghwan Lee] Hana Securities announced on the 20th that it maintains a buy rating and a target price of 45,000 KRW for KT. Considering KT's growth rate and expected dividend yield, the current stock price is also diagnosed as undervalued.

Hana Securities pointed out that KT is showing the direction of future 5G services by exchanging shares with Hyundai Motor. According to Hana Securities' analysis, the growth of telecom companies after 2025 depends on sales performance in the Internet of Things (IoT) and Virtual Reality (VR). From the perspective of telecom shareholders, the success of IoT and the metaverse (extended virtual world) is important, and in this regard, the share exchange between KT and Hyundai Motor Group is considered meaningful.

However, it is expected that 5G connected car materials will be reflected in the stock price in the second half of 2023. This is because the next-generation network, 5.5G, is only at the discussion stage, and the commercialization schedule is expected to be announced in the second half of 2023.

Hana Securities also analyzed that it is realistically difficult for its affiliate, the internet-only bank K-Bank, to go public within this year. This is because the recent sluggish stock market and continued weakness in growth stocks give management no reason to pursue an IPO at a low price. Hana Securities diagnosed that there is a large gap between KT management's target market capitalization for K-Bank's IPO and investors' appropriate market capitalization for K-Bank.

Hana Securities forecasts that KT's stock price will move within a box range for the time being and then rise in early next year. Kim Hongsik, a researcher at Hana Securities, said, "Due to a lack of short-term catalysts, even during the dividend investment season, the stock price is not expected to rise significantly, so we recommend box range trading between 35,000 KRW and 40,000 KRW considering an expected dividend yield of 5.5~6.5% for the time being," adding, "After the confirmed dividend for 2022 is announced and the 2023 earnings expectations are priced in early 2023, a more dynamic stock price increase is expected."

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