Seobu T&D, which has drawn attention recently as a land asset stock and seen its share price swing, will conduct an asset revaluation. The revaluation found that the book value of Seobu T&D's real estate holdings rose 28% from last year to the 270 billion won range.
Investor attention is focusing on whether this large-scale asset value increase will serve as a catalyst to prop up the stock price. However, short-selling indicators have also risen noticeably in recent days, suggesting a cautious approach is needed despite the optimistic outlook.
On the 30th, Seobu T&D shares closed at 13,100 won, up 4.8% (600 won) from the previous trading day. It was the first time in nine sessions that the stock recovered the 13,000 won level on a closing basis.
The rebound appears to reflect investor sentiment stirred by the released disclosure the previous day announcing the asset revaluation. On the 29th, Seobu T&D disclosed it would conduct an asset revaluation across its investment properties and property, plant and equipment held by the company, raising expectations for realizing asset values.
As of the 30th of last month, the book value of Seobu T&D's investment properties and property, plant and equipment came to 2.7223 trillion won. Seobu T&D also conducted an asset revaluation last year, and compared with then, the book value alone is up about 28%. According to the filing, this revaluation added the land and buildings of Shilla Stay Mapo. As a result of last year's asset revaluation, Seobu T&D's revaluation surplus was 336.7 billion won.
Asset revaluation is the process of reassessing the asset value of land and other items held by corporations at current fair value rather than at acquisition book value and reflecting it in the financial statements. If this increases total assets, it can improve a company's financial structure, such as by lowering the liability ratio.
The market is watching whether the stock can extend gains on the asset revaluation. As of the day, Seobu T&D's market capitalization was 817.8 billion won, widely seen as significantly below the book value of its assets (in the 2.7 trillion won range). In other words, the overall value of the corporation is being assessed far lower than the value of the land and buildings it owns.
Seobu T&D's share price has surged 127% from early this year, tracing a steep upward curve. Tailwinds across its hotel, mixed-use shopping center operations and real estate development businesses contributed. In particular, since the summer it has emerged as a beneficiary "hotel stock" on expectations from visa-free entry for Chinese group tourists and signs of easing of the ban on Korean cultural content. Seobu T&D currently operates "Seoul Dragon City," Korea's largest hotel complex with four hotels, including Novotel and Grand Mercure, clustered in Yongsan-gu, Seoul.
This month, Seobu T&D entered the ranks of "land asset stocks" in earnest. After Chunil Express shares soared on expectations for development of the Seoul Express Bus Terminal, attention shifted to other land asset stocks with potential development catalysts.
Seobu T&D has been cited as a leading beneficiary because it owns sites such as Yongsan Najin Arcade and the Sinjeong-dong Seobu Truck Terminal site, both slated for large-scale development, and in the process the stock at one point spiked more than 21% in a single day.
However, after the short-term surge, the stock showed a somewhat sluggish trend. After jumping 21% to 14,070 won on the 11th, it fell about 11% through the previous day as profit-taking hit. Even so, expectations that development of key sites will enter full swing, along with the asset revaluation, are likely to persist for the time being.
Ryu Tae-hwan, an analyst at Eugene Investment & Securities, said the "schedules for permits and groundbreaking for the planned Yongsan Najin Arcade and the Sinjeong-dong Seobu Truck Terminal have become more concrete," adding, "It is necessary to focus on visible pre-sales revenue and development profit going forward." The securities industry expects that after obtaining permits in the first half of next year, Najin Arcade will generate development revenue starting in the second half of 2026, and Sinjeong-dong in the second half of 2027.
However, caution is advised regarding short selling. Recently, Seobu T&D's outstanding balance of stock lending transactions has been gradually increasing. Stock lending is when an investor who holds shares lends them to another investor, and it is generally interpreted as a short-selling indicator. Despite the major positive of asset revaluation, investors should note that some are increasingly betting on profit-taking or declines following the sharp rise in the stock.
Until before the 11th, when the stock jumped 21%, Seobu T&D's outstanding balance of stock lending transactions remained around 2.5 million shares, but it has since gradually increased to 3,097,934 shares on the 18th. It then stayed above 3 million shares for six consecutive sessions before coming to 2,995,466 shares on the 29th.