Samsung Biologics will have its stock transactions suspended for a month starting on the 30th ahead of next month's spin-off. As a large-cap stock ranked fourth by market capitalization on the Korea Exchange is split into two companies, investors are focusing on the future direction of the share price. In particular, with a long, monthlong trading halt ahead, many investors are weighing whether to sell their existing shares now to realize gains, or what investment strategy to take after the spin-off.
On the 22nd, Samsung Biologics closed at 1,173,000 won, up 29,000 won (2.53%) from the previous trading day. On expectations of improved third-quarter earnings, the share price of Samsung Biologics rose more than 10% this month from the 1 million won range to the high-1.1 million won range.
Existing investors are torn between selling now to lock in profits ahead of the long, monthlong trading halt, or betting on a post–spin-off share-price rise. While the combined value of the two companies' shares after the spin-off is expected to be higher than before the split, the rapidly changing internal and external environment makes it burdensome to have shares tied up for a month.
After the split, Samsung Biologics and Samsung Bioepis Holdings, which will separate into distinct companies, have completely different business areas. Samsung Biologics' core CDMO business is highly stable with significant potential for future expansion. In contrast, Samsung Bioepis Holdings' drug development business is driven by expectations for new drug development and technology transfer as its main business model.
Outlooks diverge on the direction of the two companies' share prices. Considering Samsung Biologics' solid CDMO business and the industry's growth potential, there is room for additional gains, but there are assessments that, relative to the split ratio, Samsung Bioepis Holdings' results may fall short of expectations.
Lee Seon-gyeong, an analyst at SK Securities, said, "After the spin-off, the value of Samsung Biologics will rise, and the value of Samsung Bioepis Holdings is expected to decline," while adding, "It is worth noting that Samsung Bioepis Holdings, as a drug development company, has potential for mid- to long-term growth."
For Samsung Biologics, structural growth is expected as Plant 5 starts contributing meaningfully to revenue from 2027. A decision on whether to break ground on Plant 6 within the year is pending, and with the possibility of building a plant in the United States emerging, business expansion appears set to continue. In particular, as the global CDMO industry grows rapidly, the market is becoming supplier-driven rather than demand-driven, and the overall industry size is projected to expand.
Yeo Norae, an analyst at Hyundai Motor Securities, said, "As tariff risks are being resolved through negotiations between global pharmaceutical companies and the Trump administration, a positive environment is forming for additional orders from clients or attracting new clients," adding, "Although volatility will be high immediately after the split, considering the operation of Plant 5, we expect it to enter an attractive zone."
By contrast, the share-price outlook for Samsung Bioepis Holdings immediately after the split is somewhat dim. Analysts say that because the split ratio is set favorably compared with Samsung Biologics, the stock is likely to fall after the split.
Supply-demand dynamics are also unfavorable. According to MSCI (Morgan Stanley Capital International), Samsung Biologics will remain in the index after the spin-off, but Samsung Bioepis Holdings will be excluded because it does not meet inclusion criteria.
Accordingly, the shares of Samsung Bioepis Holdings distributed for the equity in Samsung Biologics held by passive (index-tracking) funds are expected to be sold in full on the first day of listing. Based on the current equity stake held by MSCI index passive funds, the size of the sell orders is about 260 billion won. Significant selling pressure is expected from the first day of trading resumption.
Ko Kyung-beom, an analyst at Yuanta Securities Korea, said, "Given the high controlling shareholders' equity ratio, Samsung Bioepis Holdings' share price, which has low liquidity, could surge, but the selling impact from passive funds will be that much greater."
This spin-off separates Samsung Biologics' contract development and manufacturing (CDMO) business from its subsidiary Samsung Bioepis. Existing shareholders of Samsung Biologics will receive shares of the newly established holding company, Samsung Bioepis Holdings, according to the split ratio after the spin-off. The split ratio is about 0.65 to 0.35, and based on the current share price, Samsung Biologics' market capitalization is estimated at about 53 trillion won and Samsung Bioepis at about 29 trillion won.
Samsung Biologics will announce its third-quarter results on the 28th, ahead of the spin-off. In the market, the prevailing view is that the results will beat market expectations (consensus).