Research analysts from major Korean securities firms released reports analyzing the impact of new dual listing regulations on LS Group and other major Korean stocks during the third week of July. Money Today's securities division selected three reports as weekly best analyses: Jang Jae-hyuk of Meritz Securities examined LS Group's subsidiary listing roadblocks under updated dual listing guidelines, Jang Young-im of SK Securities previewed Mirae Asset Securities' second-quarter performance with focus on SpaceX valuation impacts, and Kim Young-gun of Mirae Asset Securities analyzed SK Hynix's earnings outlook adjustments. The regulatory changes introduced specific approval gates for subsidiary listings, directly affecting LS Group's plans for LS Cable, LSMnM, and Essex Solution. Korean financial authorities implemented the principle of prohibiting dual listings with exception-based approval criteria, fundamentally altering the landscape for corporate spinoffs and subsidiary public offerings in the Korean stock market.
LS Group Subsidiary Listings Face New Regulatory Barriers
Jang Jae-hyuk analyzed the impact of financial authorities' detailed dual listing criteria on LS Group's subsidiary structure. LS Cable, LSMnM, and Essex Solution must each pass individual regulatory approval gates under the new framework, blocking sequential listing scenarios. LS Cable was established through physical division during the 2008 holding company conversion process, positioning it as a physically divided subsidiary that requires shareholder approval. LS representative director and vice chairman Myeong No-han stated on March 26 at the regular shareholders meeting that the company generated approximately 1.5 trillion won in cash, indicating limited need for additional capital raising arguments even under individual review processes.
LSMnM Listing Structure and August 2027 Deadline
LSMnM originated as joint venture LS-Nikko Copper Smelting in 1999 and became an acquisition-type general subsidiary after purchasing JX Metals' 49.9 percent stake in 2022. The company issued an exchangeable bond to JKL Partners for acquisition financing, with the exchange right exercised in December 2024 reducing the stake to 24.9 percent. A listing completion agreement exists with a deadline of August 2027. While shareholder non-approval opens an individual review pathway, high proportions of existing shareholder sales (JKL) are anticipated to influence exchange review processes.
Mirae Asset Securities Rating Upgrade Despite SpaceX Valuation Concerns
Jang Young-im upgraded Mirae Asset Securities' investment opinion from neutral to buy while lowering the target price from 69,000 won to 51,000 won. The analyst confirmed improved earnings capacity in core securities operations and overseas subsidiaries, projecting second-quarter net income attributable to controlling shareholders at 1.486 trillion won, up 268 percent year-over-year and exceeding consensus by 7 percent. The target price reduction reflects potential valuation losses on SpaceX holdings in the second half, with the analyst noting that earnings volatility tied to single-stock valuation levels represents a clear discount factor.
SK Hynix Earnings Forecast Lowered 12 Percent Amid Market Volatility
Kim Young-gun maintained SK Hynix's target price at 4.2 million won while lowering earnings forecasts by 12 percent, noting recent share price declines already reflected the adjustment. The analyst cited robust external market indicators, including TSMC's June revenue of 443 billion Taiwan dollars (approximately 20.378 trillion won), up 67 percent year-over-year and achieving record-high revenue and growth rates while exceeding second-quarter guidance. Second-quarter operating profit estimates were revised from 70.7 trillion won to 62.3 trillion won, a 12 percent reduction, while next year's operating profit projection remains at 389 trillion won, up 45 percent year-over-year. SK Hynix shares closed at 1.842 million won on the 16th after an 11 percent decline.
FAQ
What did Korean financial authorities announce regarding subsidiary listings?
Korean financial authorities announced detailed criteria implementing a principle of prohibiting dual listings with exception-based approval. Under these rules, LS Group subsidiaries including LS Cable, LSMnM, and Essex Solution must each pass individual regulatory approval gates, blocking sequential listing scenarios that were previously possible.
Why did Mirae Asset Securities receive both a rating upgrade and target price reduction?
Jang Young-im of SK Securities upgraded Mirae Asset Securities' investment opinion from neutral to buy based on improved earnings capacity in core securities operations and overseas subsidiaries. However, the target price was lowered from 69,000 won to 51,000 won due to potential valuation losses on SpaceX holdings in the second half, with earnings volatility from single-stock exposure representing a discount factor.
What is the LSMnM listing deadline?
LSMnM has a listing completion agreement with a deadline of August 2027. This agreement relates to an exchangeable bond issued to JKL Partners for acquisition financing, with the exchange right exercised in December 2024 reducing JKL's stake to 24.9 percent.
