[Click e-Stock] "KT: Net Subscriber Growth and Real Estate Pre-sales... Nothing to Worry About"

On July 11, DB Securities raised its target price for KT from 65,000 won to 75,000 won, stating that although there may be temporary marketing competition in the second half of this year, net subscriber additions and growth in real estate pre-sale revenue are expected to offset this. The investment opinion remains 'Buy'.

KT's consolidated revenue for the second quarter is estimated at 7.383 trillion won (+12.8% year-on-year), with operating profit at 927.4 billion won (+87.7%), both expected to exceed market expectations. Shin Eunjeong, a researcher at DB Securities, explained, "It appears that 600 billion won in real estate pre-sale revenue and 300 billion won in profit from Gwangjin-gu have been reflected," adding, "In the third quarter, an additional 100 billion won in remaining real estate pre-sale revenue is expected to be recognized, leading to solid results."

Among major affiliates, BC Card is expected to see sluggish sales due to a decline in domestic purchase volume. However, KT Cloud is expected to achieve 11% year-on-year sales growth, driven by increased utilization rates at the Gasan and Bucheon data centers. Net mobile number portability additions in the second quarter reached 280,000. Shin noted, "In the third quarter, revenue recognition from the fully increased subscriber base will be possible, so wireless revenue is projected to grow by 4%."

KT's expected annual dividend per share (DPS) for this year is 2,500 won, and the total shareholder return yield, reflecting 250 billion won in share buybacks, is approximately 6.1%.