KT&G to Strengthen Shareholder Return Policy as Share Price May Continue Rebounding

KT&G (Korea Tobacco & Ginseng) will strengthen its shareholder return policy, with its target share price raised from KRW 100,000 to KRW 107,000.

According to a quick report from Korea MT on October 17, KT&G will strengthen its shareholder return policy, and its target share price has been raised from KRW 100,000 to KRW 107,000. 

IBK Securities estimates that KT&G will post third-quarter sales of KRW 1.6292 trillion and operating profit of KRW 351.9 billion, up 0.3% and 13.2% year-on-year, respectively. However, sales and operating profit in its cigarette business are expected to decline 4.7% and 14%, respectively, to KRW 899.4 billion and KRW 230.3 billion. 

Researcher Kim Tae-hyun said, “Although earnings volatility is likely to continue into the fourth quarter, the market has given higher marks to enhanced shareholder return policies such as the introduction of semi-annual dividends and the repurchase and cancellation of treasury shares.” 

He also predicted, “As year-end approaches, a 6% dividend yield and expectations for next year’s performance will continue to support a rebound in the share price.” 

In addition, KT&G’s heated tobacco product “Lil” has already launched in 31 countries worldwide, and the company is expected to strengthen its global business capabilities by expanding its overseas factory in Kazakhstan.