[Click e-Stock] "KT in Final Phase of Negative Developments... Year-End Stock Rebound Expected"

Hana Securities recommended a phased buying approach for KT in December, stating on the 27th that KT is likely to emerge as a beneficiary stock due to the year-end legislative move to mandate the cancellation of treasury shares and the introduction of separate taxation on dividends. The investment opinion remains "Buy," with a target price maintained at 65,000 won.

Hana Securities acknowledged that KT still faces risks, including the possibility of additional losses related to hacking incidents and concerns over policy changes due to management reshuffles. However, the firm believes that the company is entering the final phase of negative developments. From the end of the year, KT is expected to show a flexible rebound in its stock price.

Hongshik Kim, a researcher at Hana Securities, explained, "The company is expected to maintain strong profit growth through 2026, and there is a high likelihood that the entire shareholder return amount will be paid out as dividends next year, which could result in a 58% increase in dividends per share (DPS). After the year-end, KT is likely to become one of the representative beneficiaries of the separate dividend taxation policy in 2026."

While there are concerns in the market about potential changes to KT's existing value-up (corporate value enhancement) policies due to the management reshuffle, it is viewed as unlikely in reality. This is because KT's profit-generating capacity has improved significantly compared to the past, and regulatory authorities are also advocating for the strengthening of value-up policies.

Kim further commented, "KT's estimated annual adjusted consolidated net income for 2025-2026 is between 1.7 trillion and 1.8 trillion won, and even if the total annual dividends are in the range of 850 billion to 950 billion won, the dividend payout ratio would be around 50%. Considering the historical payout ratio, this is by no means excessive. The 600 billion won in apartment pre-sale profits for 2025 is also being treated as a special gain."

He added, "In 2026, KT is highly likely to pay out the entire 950 billion won in total shareholder returns as dividends. For those receiving less than 300 million won in dividends, the after-tax yield could reach 6%, classifying KT as a beneficiary of the separate dividend taxation policy."

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