Shinhan Investment Securities said on the 31st that, in addition to record earnings, the largest-ever shareholder return is expected for Kiwoom Securities(039490). It maintained an investment opinion of "Buy," but lowered the target price to 4.2 million won, considering stock market volatility. Kiwoom Securities' previous day's closing price was 258,500 won.
Kiwoom Securities had said in a value-up disclosure that it would return at least 30% of separate net income to shareholders. Based on this, Shinhan Investment Securities projected that if the 2026 settlement of account shareholder return is executed entirely as a cash dividend, the expected dividend per share (DPS) would reach 22,000 won. This corresponds to a dividend yield of 8.5% based on the previous day's closing price.
Even assuming lower earnings in 2027, the settlement of account dividend yield is analyzed to be 7.4%, an absolutely high level.
Researcher Lim Hee-yeon at Shinhan Investment Securities said, "It appears a dividend-yield equalization will occur toward the typical 5% expected dividend yield for financials, and a re-rating of the share price is expected in the process."
Kiwoom Securities' second-quarter controlling interest net profit this year was 680.1 billion won, up 119.6% from a year earlier. This is an earnings surprise that far exceeded Shinhan Investment Securities' estimate (560.7 billion won) and the market consensus (510.9 billion won). The consolidation return on equity (ROE) was 32.4%.
For brokerage commissions, domestic stocks recorded 316.5 billion won and overseas stocks 135.5 billion won. These figures rose 37% and 69%, respectively, from a year earlier.
Retail market share (MS) was 25%, and the fee rate was 1.4 bp (1 bp = 0.01 percentage point). The average daily notional in overseas stocks rose in tandem to 2.1 trillion won, with the fee rate at 10.2 bp. The average number of active accounts also exceeded 4.3 million.
Investment banking (IB) fee income rose 56.3% to 83.3 billion won.
Lim explained, "IB fee income is centered on real estate project financing (PF)."
Of the 249.2 billion won in trading and investment gains, up 60.1% from a year earlier, trading gains came to 204.4 billion won.
Lim explained, "Thanks to a bull market, profits and losses related to stocks, collective investment securities, and exchange-traded funds (ETF) expanded sharply."
Selling, general and administrative expenses totaled 292 billion won, up 47.7%, which was analyzed as the effect of increased performance bonuses and higher education tax due to expanded transaction value.
Lim said, "Compared with the ROE expected for this year and next year, the price-to-book ratio (PBR) appears to be significantly undervalued."