Returning to Original Corporate Value? Samsung Episholdings Shares Rebound [Market Focus]

As of 10:10 a.m. on November 27, shares of Samsung Episholdings on the Korea Exchange were trading at 419,000 won, up 15.43% from the previous day's closing price. After a sharp decline on the relisting date following the spin-off on the 24th, the stock has shown a recovery trend with two consecutive days of gains.

On the first day of the relisting on the 24th, Samsung Biologics fell by only 8,000 won (0.45%) from its reference price, but Samsung Episholdings plunged 28.23% to close at 438,500 won. The price of Samsung Episholdings dropped to 335,500 won on the 25th, but recovered to 363,000 won on the 26th.

Previously, securities firms pointed out that the initial market capitalization of Samsung Episholdings was inflated, as the spin-off ratio was calculated based on net asset value. They had suggested a fair market capitalization of 10 to 12 trillion won. As of the morning of the 27th, the market capitalization surpassed 10 trillion won, indicating that the stock has returned to a more appropriate level.

Just before trading was suspended due to the spin-off, the market capitalization stood at 56.5 trillion won for Samsung Biologics and 30.4 trillion won for Samsung Episholdings, respectively.

The biosimilar business, which was a key factor in determining the corporate value of Samsung Episholdings, is subject to earnings volatility depending on the timing of product launches and milestone (stepwise licensing fee) recognition. In addition, on a separate basis, Samsung Biologics has an operating margin in the 40-50% range, while Samsung Bioepis operates at around 20%.

The lack of visible results from the new drug pipeline, which could further enhance corporate value, has also been a factor contributing to the relative weakness in the stock price.