Hotel Shilla shares are surging early on the 19th. The jump comes after Hotel Shilla decided to return the business license for the Incheon Airport duty-free DF1 zone.
As of 9:13 a.m. that day, Hotel Shilla stock was trading on the Korea Exchange at 57,400 won, up 8.30% (4,400 won) from the previous day.
Earlier, on the 18th, Hotel Shilla disclosed that it had decided to return The Shilla Duty Free's business license for the Incheon Airport duty-free DF1 zone.
Regarding the reason for returning the license, Hotel Shilla said, "Excessive losses are expected, so we judge that the value of continued operation is lower than the liquidation value," adding, "Sales are expected to decrease in the short term, but in the mid to long term we expect an overall financial improvement effect for the company."
In a separate document, it explained, "The losses are too large to continue operating at Incheon Airport," and "We inevitably decided to return the license based on the judgment that improvements in the financial structure and enhancement of corporate and shareholder value are necessary."
In the securities industry, expectations emerged that Hotel Shilla's duty-free business performance will improve as it returns the business license for the Incheon Airport duty-free DF1 zone.
Jang Min-ji, a researcher at Kyobo Securities, analyzed, "The effects of the performance improvement are expected to be reflected starting in the second quarter next year, and on an annual basis, operating profit and loss could improve by more than 40 billion won."
She added, "A narrowing of duty-free losses is expected to have a positive effect on the hotel division's revaluation."