NH Investment & Securities said on the 3rd that SK is undervalued relative to its asset value. It kept a "Buy" rating and raised the target price to 405,000 won from 330,000 won. SK's closing price the previous day was 299,500 won.
Lee Seung-young of NH Investment & Securities said, "We raised the target price to reflect the increase in the value of investment assets such as SK Square and SK Telecom," and noted, "The current share price trades at a 59.4% discount to net asset value (NAV), the highest among major holding companies."
The analyst noted that SK is improving the group's financial structure through asset sales and portfolio integration. The company is expected to expand dividends by using gains from asset sales such as SK Specialty and the Pangyo data center. Assets that could be sold include SK Siltron, a silicon wafer manufacturer, and Watson, a Chinese copper foil company.
Policy changes are also noteworthy. The analyst said, "SK's treasury shares amount to 24.8% based on common stock, so if the mandatory cancellation of treasury shares materializes, it is expected to be a beneficiary," adding, "In addition, as the Fair Trade Act is revised to ease the requirements for a semiconductor holding company, the burden of additional investment in the grandchild company SK hynix will also be eased."