Brokerage : Hana Securities
Analyst : Kim Hong-sik, Sang-hoon Lee (RA)
Investment Rating : BUY (Maintained)
Target Price : KRW 76,000 (Maintained)
Core Momentum : Expectations of long-term ARPU expansion driven by premium AI-bundled rate plans, anticipated benefits from the 2027 domestic AI base station rollout, and structural valuation support rooted in absolute PBR-based undervaluation
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: BUY (Maintained) / KRW 76,000 (Maintained)
- Key Valuation Multiples (2026F):
- PER: 9.19x
- PBR: 0.69x
- EV/EBITDA: 3.67x
- BPS: KRW 76,641
- ROE: 7.93%
- Expected DPS: KRW 2,400
- Consolidated Financial Highlights & Forecasts (K-IFRS):
- 2024: Revenue KRW 26.43T, Operating Profit KRW 809.5B, Net Profit KRW 470.3B, EPS KRW 1,850
- 2025: Revenue KRW 28.24T, Operating Profit KRW 2.47T, Net Profit KRW 1.73T, EPS KRW 6,869
- 2026F (Forecast): Revenue KRW 27.77T, Operating Profit KRW 2.05T, Net Profit KRW 1.45T, EPS KRW 5,745
- 2027F (Forecast): Revenue KRW 29.47T, Operating Profit KRW 2.09T, Net Profit KRW 1.52T, EPS KRW 6,036
🚀 2. [Market Opportunities & Business Outlook]
- Q2 Earnings Performance & Cost Pressures:
- Standalone Q2 operating profit came in at KRW 389.0B (-17% YoY, +23% QoQ), meeting estimates but reflecting sluggishness due to 5G subscriber churn, lower mobile service revenues, and rising labor/operational expenses.
- A KRW 54.0B regulatory fine in non-operating expenses pulled cumulative H1 standalone net profit to KRW 625.3B. Under KT’s payout policy of distributing 50% of adjusted standalone net profit, the likelihood of a DPS increase this year remains low.
- Consolidated Q2 operating profit reached KRW 648.3B (-36% YoY, +34% QoQ), impacted by lower real estate pre-sale revenue but beating consensus due to strong subsidiary contributions of KRW 259.3B led by KT Estate.
- Telecom Drivers & Structural Growth Opportunities:
- The rollout of rate plans priced at KRW 90,000 or higher bundled with AI services is expected to drive long-term ARPU expansion over time.
- Telecom infrastructure benefits are anticipated as domestic AI base station deployments gain traction by 2027.
- Despite subdued short-term dividend appeal, absolute undervaluation on a PBR basis and expected long-term telecom industry recovery are projected to limit downside risks.
📝 Editor’s Comment (Perspective)
The analyst views KT not through the lens of short-term dividend expansion or immediate earnings momentum, but as a medium- to long-term value normalization play positioned for an industry recovery driven by AI-integrated premium tariff restructuring and upcoming AI base station infrastructure. This perspective places greater emphasis on absolute PBR-based undervaluation and long-term earnings growth potential rather than near-term margin pressure and capped annual dividend growth.
To verify whether this investment thesis unfolds as anticipated, key monitoring points include whether the rollout of AI-bundled rate plans translates into tangible high-tier subscriber inflows and ARPU expansion, and whether actual business tailwinds emerge from the domestic AI base station rollout in 2027. Relevant updates can be verified through subsequent quarterly MNO operating metrics, official earnings releases, IR presentations, and periodic regulatory filings.
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