New Street Research - KT Corp (ADR) (KTC) ... South Korean Telcos Q2 24 review: Softer but capex moderation remains encouraging

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New Street Research

Chris Hoare

EUR 9281.00 For Business Accounts Only

South Korean Telcos Q2 24 review: Softer but capex moderation remains encouraging

Group service revenue and EBITDA trends were softer in Q2, beset by slower Enterprise growth and a one-off labour cost hike by KT. By contrast, mobile improved to 2.1% YoY, led by SKT and KT. Given the benign mobile landscape and the removal of Stage X’s mobile license, we expect trends to sustain at current levels. Capex spend is under control while quarterly dividends were unchanged. Separately, we have trimmed our target prices for SKT and LG Uplus; KT remains our preferred pick.

27/08/2024 1 EN

Underlyings

KT Corp (ADR)

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US48268K1016 Berlin Stock Exchange South Korea

LG Uplus

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SK Telecom Co. Ltd.

SK Telecom is a wireless telecommunications services provider in the Republic of Korea (South Korea). Co. provides the following services: wireless Internet services, which include music portal services, game portal services, multimedia services, and wired and wireless integrated multimedia services; ubiquitous and convergence services, which include telematics, digital home, commerce, mobile radio frequency identification and mobile community; international roaming services, which include global system for mobile communication; video telephony services, which enable subscribers incorporating video conferences, as well as B2B services.

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KR7017670001 Korea Stock Exchange South Korea

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Analysts

Chris Hoare

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South Korean Telcos Q2 24 review: Softer but capex moderation remains encouraging

SK Telecom (Buy, TP: KRW 100,000, +74%) Q3 24 Quick Take: Encouraging Enterprise growth and a decent improvement in EBIT

KT Corp (Buy, TP: KRW 70,000, +59%) New Corporate Value Up Plan Represents a Positive Step Forward

SK Telecom (Buy, TP: KRW 116,000, +101%) New Corporate Value Up Plan

Match Group (MTCH, Buy, $54 target) MTCH First Take: Positioning for a break up?

MELI US (Neutral, TP: $2,000, -5%) MercadoLibre Credit cards drive big NIMAL and group EBIT miss

Frontier Post-3Q24 Model Update

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