Shareholders of Emart, known as 'shares that trap investors,' are going through ups and downs. This year, the Emart stock price, which dropped to an all-time low during the summer and was called 'the ant's swamp,' has recently been experiencing sharp fluctuations. In the securities industry, there is a growing caution about the increased volatility of stock prices in the short term.
According to the Korea Exchange, Emart's stock price has risen 18.9% from the official announcement made by Shinsegae Group about the separation of Emart and department store branches on Oct. 30 until this month, the 26th. Compared to June 27, when it recorded the lowest price since its listing in 2011 (54,800 won), it has increased by 37.8%.
Notably, after news broke on the 23rd that Chung Yong-jin, chairman of Shinsegae Group, met with U.S. President-elect Donald Trump, Emart's stock price jumped 14.7%. Additionally, following reports on the 26th that it partnered with Alibaba, the stock price rose by 5.45% in a single day, with an increase of over 6% in after-hours trading from the closing price (75,500 won).
However, since most individual investors who purchased Emart stocks are still at a loss, recovering their principal remains distant. According to NH Investment & Securities, as of the 24th, the average return of 17,936 investors who invested in Emart through this securities firm was minus (-) 30.5%. Currently, 86.9% of all investors are in the red, and only 13 out of 100 investors made a profit. The average purchase price was 125,867 won, which is double the current stock price.
Emart's stock price, which had been on a steady decline, found several opportunities for rebound this year. On Feb. 2, due to the financial authorities' push for value-up policies, stocks with low price-to-book ratios (PBR) gained attention, and Emart's stock touched a yearly high of 88,500 won. However, it quickly fell sharply and plummeted to an all-time low on June 27. Although Emart's stock seemed to rebound after reporting performance that exceeded market expectations in August, it soon fell back and has continued a sluggish trend.
This month, institutional investors have been net buyers of Emart stocks on all trading days except for four, contributing to the rise in stock prices. The amount they purchased is worth 23.15768 billion won. However, during the same period, individuals and foreigners sold off 3.92478 billion won and 19.08208 billion won, respectively, offsetting these purchases.
Given the situation, there are somewhat skeptical forecasts regarding Emart's mid- to long-term stock movements in the securities industry. Although Chung Yong-jin met with President-elect Trump and established a joint venture (JV) with Alibaba, none of the securities firms have upgraded their investment ratings or target stock prices. On the day following the JV news, Emart's stock plummeted by 9.8%, reversing this week's gains.
Kim Myung-joo, a researcher at Korea Investment & Securities, noted, "While it is positive that Gmarket, which has lacked a clear strategic direction, secured a strategic partner, it is difficult to foresee a clear synergy strategy with AliExpress." He added, "Due to Emart's prolonged poor performance, the expectations for improvement in gross profit margin (GPM) among investors and analysts are not high."