NH Investment & Securities said on the 13th that it was the first among brokerages to announce a plan to dispose of treasury shares it already held for Daishin Securities, calling it a surprise that beat expectations. It maintained a Buy rating and raised its target price to 52,000 won from 33,000 won. Daishin Securities' previous day's closing price was 36,100 won.
Earlier, Daishin Securities said the previous day (on the 12th) that it would cancel 15.35 million treasury shares. Researcher Yun Yudong at NH Investment & Securities said, "It is positive that the company disclosed a plan to dispose of previously held treasury shares in preparation for the implementation of the Commercial Act amendment," and noted, "Attention is also growing on the moves of Bookook Securities and Shinyoung Securities, which have a high proportion of treasury shares."
Daishin Securities will cancel about 9.32 million common shares among previously held treasury shares, split across six quarters from the time the Commercial Act amendment is announced. It also plans to use about 1.5 million shares as a fund for employee performance bonuses through 2029. With about 1.5 million shares, it will run an employee stock ownership plan through 2030. With a four-year trading ban, there is expected to be no overhang issue. It plans to cancel all 4.85 million class 1 preferred shares and 1.18 million class 2 preferred shares.
Yun said, "This is a cancellation decision for 18.4% out of 24.3% of common-share treasury holdings," and analyzed, "The largest shareholder's equity stake is 18.4%, and if we assume the current common shares are all canceled, it would rise to 22.5%."
Daishin Securities is also showing an aggressive stance in its existing value-up policy, touting a minimum dividend per share (DPS) of 1,200 won and tax-exempt dividends within 400 billion won.
However, the key will likely be earnings. Daishin Securities recognized large losses related to overseas real estate in the fourth quarter of last year and moved to clean up bad assets.
Yun said, "From the first quarter of this year, we focus on whether it can generate earnings befitting a major firm," and explained, "It is aiming for authorization to issue short-term notes in 2028, and in addition to meeting the requirement of achieving 4 trillion won in separate equity capital, it needs to prove that its investment banking (IB) and asset management capabilities are ready."