9 out of top 10 Korean conglomerates’ market capitalization tumble down

August 26, 2013 Leave a comment

9 out of top 10 conglomerates’ market capitalization tumble down

2013.08.25

South Korea’s 10 biggest family-owned conglomerates saw their stock market capitalization plummet this year, with the sole exception of SK Group. The combined market capitalization of the conglomerates’ 90 listed subsidiaries came to 630.9 trillion won ($567 billion) as of Friday, the latest trading day, said the Korea Exchange (KRX) and local financial data provider FnGuide Sunday. This is 9.4 percent, or 65.6 trillion won, down from 696.5 trillion won early this year. During the same period, the benchmark KOSPI retreated 7.9 percent. Of the top 10 conglomerates, Samsung Group suffered the largest market capitalization loss worth 46 trillion won, or 14.1 percent, followed by LG Group (6.6 trillion won), GS Group (2.9 trillion won), and Lotte Group (2.8 trillion won). Samsung Electronics’ share prices tumbled down, accounting for the biggest of proportion of Samsung Group’s market value loss. The market capitalization of Samsung Electronics declined 17.8 percent, or 41.4 trillion won, from 232.1 trillion won early this year to 190.8 trillion won as of now. LG Group’s market value fell, driven by LG Chem’s loss of 4.3 trillion won and that of LG Household & Health Care worth 2.3 trillion won. GS Group was mainly hurt by GS E&C, as the construction subsidiary has won contracts with lower profitability and remained in red ink for a prolonged period, and as a result its market capitalization tumbled down 47.2 percent, or 1.4 trillion won. SK Group was the single conglomerate whose market value increased. Most of the group’s subsidiaries fared poorly in the stock market, yet the market value of SK Telecom jumped 38.2 percent, or 4.6 trillion won, from that of early this year, contributing to a modest increase in market capitalization at a group-wide level.

Filed under Macro Trends

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment