Hana Securities on the 2nd said Seoul Auction's share price could soon turn higher as signs of a rebound emerge in the art auction market. It did not provide a target price or investment opinion. Seoul Auction's closing price in the previous session was 7,730 won.
Seoul Auction is the No. 1 player in the art transaction market, with strong ability to source high-quality artworks based on long experience. Together with K Auction, it holds about a 90% share of the art auction market. As of the third quarter last year, cumulative revenue was 15.7 billion won and operating loss was 2.3 billion won.
High net worth individuals waited last year for the new administration's tax policy to take shape, and art transactions were not active. Park Chan-sol, an analyst at Hana Securities, said, "With the tax reform plan passing the National Assembly at the end of last year, some uncertainty has eased, and as prices of assets such as real estate and stocks continue to rise, the art auction success rate is in a rebound process." Park noted that even considering that improvements in real consumption appear in the late stage of the overall economic cycle, the art market had been neglected.
In January this year, Seoul Auction put 5 billion won worth of artworks up for auction, and K Auction put 9.8 billion won up for auction. Park said the two companies tend to increase the scale of offerings between April and June, and analyzed that if each company puts more than 10 billion won up for auction going forward, it could be seen as a full-fledged rebound signal for the art auction market.
Park said, "As the rise in major asset prices continues, art this year could reemerge as a store of value," adding, "At this point, we judge that Seoul Auction's auction market-related earnings have already bottomed, and the share price will soon enter an upward trend."