Securities analysts said Hyundai G.F Holdings' move to make Hyundai Home Shopping a wholly owned subsidiary is expected to prompt a revaluation of corporations' value by resolving the dual-listing structure.
Choi Gwan-soon, an analyst at SK Securities, said in a report on the 12th that "Hyundai G.F Holdings' governance restructuring could narrow the discount stemming from the dual listing of the holding company and its subsidiary, and liquidity will increase as the number of shares in circulation rises."
Choi added, "By bringing Hyundai Futurenet in as a subsidiary, the company resolves the holding company's conduct restriction regarding Hyundai Bioland (a holding company's grandchild company must hold 100% equity in a great-grandchild company), and dividends income could increase by adding subsidiaries such as Hyundai Futurenet and Handsome."
Earlier, Hyundai G.F Holdings decided to make the company a 100% subsidiary through a comprehensive stock exchange with Hyundai Home Shopping. After the exchange, Hyundai Home Shopping will be delisted and split into an investment company and an operating company through a spin-off. The investment company will then merge with Hyundai G.F Holdings, while the operating company plans to focus on the core home shopping business and new businesses.
Meanwhile, Hyundai Department Store Group also disclosed a plan to buy back treasury shares that day. Hyundai G.F Holdings said it will buy 100 billion won worth of treasury shares in total during the comprehensive stock exchange process to maximize the interests of Hyundai G.F Holdings and existing Hyundai Home Shopping shareholders and will retire them all within the year.
On this, Choi said, "Shareholder return policies such as share buybacks and increased dividends are also positive." In particular, this year's dividends at Hyundai G.F Holdings are expected to be 440 won, up 46.7% from a year earlier when considering the exchange ratio.
SK Securities raised its target price for Hyundai G.F Holdings to 14,500 won. Applying a 20% premium to the net asset value (NAV), the firm calculated the target and assessed the 2026 price-to-book ratio (PBR) at 0.4 times, saying the stock is undervalued relative to capital.