IBK Securities on the 17th maintained a Buy rating on Samsung C&T, saying the possibility of a revaluation of the value of its held equity and expanded shareholder returns is coming to the fore, and raised its target price to 620,000 won from 350,000 won.
Cho Jeong-hyeon, an analyst at IBK Securities, said, "The investment point for Samsung C&T goes beyond a simple revaluation of net worth (NAV) to a structure in which cash flows generated from held equity are transferred into shareholder returns."
Samsung C&T holds equity stakes in core Samsung Group affiliates such as Samsung Electronics, Samsung Life Insurance and Samsung Biologics. According to Cho, this equity value accounts for more than 90% of Samsung C&T's NAV. The explanation is that, as the value of held equity has expanded on the back of rising share prices of key affiliates recently, the possibility of an NAV revaluation is also increasing.
Brokerages in particular focused on Samsung C&T's shareholder return policy. For 2026–2028, Samsung C&T raised its shareholder return policy to return 60%–70% of dividends revenue from affiliates to shareholders and to lift the minimum dividend per share (DPS) to 2,500 won.
In particular, it pointed to the possibility of increased dividends at Samsung Electronics. For 2024–2026, Samsung Electronics has presented a shareholder return policy of returning 50% of three-year cumulative free cash flow (FCF) and regular annual dividends of 9.8 trillion won.
Cho projected that Samsung Electronics' FCF, after rising to 21.6 trillion won in 2024 and 37.8 trillion won in 2025, will continue to improve in 2026 on the back of the artificial intelligence (AI) semiconductor cycle and higher memory prices.
Cho said, "There is a burden from increased capital expenditures (CAPEX) in 2026, but it is highly likely that the magnitude of profit improvement will exceed it," adding, "Additional shareholder returns by Samsung Electronics can be linked to the logic of increased dividends revenue from affiliates at Samsung C&T and a narrowing of the NAV discount rate."
In addition, a recovery in the core businesses driven by the high-tech investment cycle was presented as a positive factor. Cho assessed, "We are in a phase where equity value lifts NAV, dividends revenue is transferred into resources for shareholder returns, and the core businesses can also recover through the high-tech investment cycle."