[Click e-Stock] "KT: Limited Earnings Impact from Security Breach"

On January 16, Korea Investment & Securities stated that the negative impact of the KT hacking incident on its earnings is expected to be limited. The firm maintained its "Buy" investment rating and a target price of 69,000 won.

Kim Jeongchan, an analyst at Korea Investment & Securities, explained, "The impact of the security breach has already been sufficiently reflected in the stock price. Since the customer compensation package will be provided for six months, some membership-related costs may occur through the second quarter of this year, but the scale is not significant. Additionally, there is a possibility that a portion of the USIM costs reflected in the fourth quarter may be reversed, so the impact on 2026 earnings deterioration will be limited."

Kim further noted, "The group's profit contribution is expected to show solid growth as KT Cloud's data center colocation revenue and public sector cloud orders increase, and as KT Estate recognizes revenue from the sale of the Daejeon Talent Development Center site. Excluding the one-off real estate sales revenue from NCP in 2025, operating profit in 2026 is projected to increase by 20.8%."

He added, "We expect a dividend yield of 4.9% in 2026, and the company is set to resume its share buyback program worth 250 billion won in February. Attention should be paid to the momentum for restoring trust and expanding shareholder returns, based on the appointment of a new CEO in March and the reestablishment of the mid- to long-term shareholder return plan."

Meanwhile, while subscriber fluctuations were limited in the fourth quarter, the volatility has widened again in 2026. From December 31, 2025, to January 13, 2026, the number of subscribers who left due to the penalty exemption policy (MNP) reached about 310,000.

Kim stated, "Although the penalty exemption policy led to subscriber churn, the number of new customers acquired in 2025 was even greater, so the likelihood of a decline in annual wireless performance in 2026 is low. After the penalty exemption period ends, MNP volatility is also expected to ease, and the impact on wireless business performance will be limited."