Equity Analysis /
South Korea

KR : Hyundai Glovis Co Ltd - Owner premium no more

    Kyung Jae Hwang
    Kyung Jae Hwang

    Head of Regional Offshore & Marine

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    CGS-CIMB
    1 April 2021
    Published byCGS-CIMB

    Korea’s Fair Trade Commission (FTC) revealed plans to reinforce disclosure rules on large logistics companies’ internal transaction details. We see this as a sentiment negative catalyst that could add hurdles to the expansion of Glovis’s PCC/logistics earnings and/or new captive businesses. We also see headwinds from Korea’s amended Fair Economy Act-3 that could lead to share price overhang or cash burn risks from affiliates. Market is overly optimistic on Glovis’s potential restructuring, which we think is unlikely to materialise and irrelevant to Chung family’s heritage tax issue.