[Click eStock] "Samsung C&T, Target Price Down Due to Stock Price Fluctuations of Listed Affiliates"

NH Investment & Securities lowered the target price for Samsung C&T from 180,000 KRW to 160,000 KRW on the 11th.

Samsung C&T is estimated to have recorded sales of 11.1998 trillion KRW and an operating profit of 495.8 billion KRW in the first quarter. Compared to the same period last year, sales increased by 7%, but operating profit decreased by 8%. The construction sector and others showed growth in performance, but the leisure sector continued to incur a loss of approximately 14.4 billion KRW. However, compared to the same period last year, the deficit appears to have narrowed. The trading division saw its operating profit decrease by nearly 60% due to a decline in global trade volume. The fashion sector is also estimated to have contracted by about 13% due to a slowdown in domestic clothing consumption.

Samsung C&T plans to distribute 60-70% of dividend income from affiliates as dividends and to cancel all treasury shares held (13.2% common stock, 9.8% preferred stock) over five years as part of its shareholder return policy. Accordingly, the total annual shareholder return amount is about 1 trillion KRW, including approximately 400 billion KRW in dividends and about 600 billion KRW in treasury stock cancellation, which corresponds to about 5.0% of the market capitalization.

Additionally, it is known that Samsung C&T plans to invest up to 4 trillion KRW over the next three years, including 2 trillion KRW to strengthen existing business competitiveness and 2 trillion KRW to discover new businesses in eco-friendly energy, bio, and healthcare sectors. The company is continuously investing in building a foundation for eco-friendly energy businesses such as solar power, hydrogen, and recycling, and recently signed a business agreement with Japan's Chiyoda on the liquid organic hydrogen carrier method (SPERA hydrogen).

Dongyang Kim, a researcher at NH Investment & Securities, stated, "We are lowering the target price reflecting the stock price fluctuations of listed affiliates and the treasury stock cancellation plan."

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