[Market Focus] Daesung Industrial Rises on Announcement to Secure Dividend Resources

As of 9:30 a.m. on July 9, Daesung Industrial's stock price on the Korea Exchange was up 9.86% from the previous day's closing price, trading at 5,070 won. This appears to be due to the company's disclosure the previous day of detailed plans to convene an extraordinary general shareholders' meeting to amend its articles of incorporation and capital structure for the purpose of dividends and other shareholder returns.

Previously, at its regular general shareholders' meeting held in March, Daesung Industrial implemented several advanced dividend policies, including reducing some merger losses through deficit compensation, securing resources for distributable profits by carrying out a free capital reduction (reducing the par value per share from 5,000 won to 1,000 won), and allowing the board of directors to determine the dividend record date. At that time, the company stated, "We will complete the transition to a capital structure that allows for distributable profits by resolving to reduce the capital reserve within the second half of 2025."

As a follow-up measure, Daesung Industrial plans to hold an extraordinary general shareholders' meeting on July 23. In its disclosure on July 8, the company specified detailed agenda items, including: ▲ an amendment to the articles of incorporation to allow profit distributions not only in cash and shares but also in 'other assets'; and ▲ a resolution, pursuant to Article 461-2 of the Commercial Act, to reduce the capital reserve by 269.2 billion won and transfer the same amount to retained earnings.

The company explained, "The second agenda item is intended to secure resources for dividends by transferring capital reserve to retained earnings. This is part of our shareholder return policy and, in accordance with relevant laws, may be used as a source for tax-exempt dividends."