[Click e-Stock] "Mirae Asset Securities: Positive Offset of Real Estate-Related Impairment Burden... Target Price Up"

On August 8, KB Securities evaluated Mirae Asset Securities positively, noting that the company has been offsetting real estate-related impairment losses with valuation gains. KB Securities raised its target price from 18,000 won to 20,000 won, while maintaining a 'Neutral' investment rating.

Kang Seunggeon, a researcher at KB Securities, stated, "The reason for raising the target price is that we have revised our annual net profit attributable to controlling shareholders forecasts for 2025 and 2026 upward by 11.9% and 1.0%, respectively, reflecting second quarter earnings that exceeded expectations. The rise in the global stock market served as a backdrop. Despite reflecting approximately 60 billion won in real estate-related asset impairment, the company has shown improvement for two consecutive quarters and overseas subsidiaries have also improved their performance. As a result, we have raised the sustainable return on equity (ROE) from 7.2% to 7.7%." He added, "Although there is potential for increased earnings volatility depending on the stock market environment, we view it positively that the company is offsetting the burden of real estate-related impairments."

He further explained, "Despite the strong second quarter results, we are maintaining a neutral investment rating due to valuation concerns."

Mirae Asset Securities' net profit attributable to controlling shareholders for the second quarter increased by 102.9% year-on-year to 403.3 billion won. Kang noted, "This figure is 45.6% higher than the consensus (the average of securities firms' forecasts), and the main reasons for exceeding consensus were 126.3 billion won in valuation gains on investment assets and improved performance by overseas subsidiaries."

Profits from brokerage and wealth management (WM) segments showed solid trends due to increased trading volume and growth in client assets. Investment banking (IB) fee income recovered to 49.6 billion won, up from 34.2 billion won in the previous quarter. Trading and product operation profits increased by 50.7% quarter-on-quarter, reflecting valuation gains on investment assets. Kang analyzed, "Due to approximately 60 billion won in real estate-related impairment, standalone profit was 234.1 billion won. However, consolidated profit exceeded expectations as income from consolidated beneficiary certificates and overseas subsidiaries was reflected. It is positive that, as in the first quarter, the company offset impairment losses with valuation gains."