[Edaily Reporter Kim Kyung-eun ] On the 7th, SKSecurities maintained its “Buy” rating and target price of 410,000 won for KOREA INVESTMENT HOLDINGS(071050), noting that the company posted second-quarter earnings that significantly exceeded market expectations. The firm also reaffirmed its “Top Pick” designation for the stock within the sector.

Jang Young-im, an analyst at SKSecurities, stated in a report released that day, “The projected return on equity (ROE) for 2026 is 23.9%, and while the expected dividend yield stands at 6.9% following the recent stock price correction, the price-to-book (P/B) ratio is only 0.8x, making the stock highly undervalued.”

KOREA INVESTMENT HOLDINGS’ second-quarter net income attributable to controlling shareholders was 995.9 billion won, up 84.7% year-over-year and 8.9% quarter-over-quarter, exceeding the consensus estimate by 19%. Analysts attribute this to balanced growth across all business divisions amid favorable market conditions, with significant profit contributions from Wealth Management (WM) and consolidated subsidiaries.

In the brokerage division, commission revenue rose 44.2% from the previous quarter, outpacing the market growth rate, driven by increased trading volume and an expansion of market share in exchange-traded funds (ETFs) centered on direct market access (DMA).

In the Wealth Management (WM) division, asset management fee revenue rose 107.8% compared to the previous quarter as sales of target-date funds and wrap accounts expanded. Due to higher turnover rates for target-date funds, related fee revenue surged significantly from the previous quarter’s range of 40 to 50 billion won to the 200 billion won range.

In the asset management division, while standalone operating profit decreased by 27.6% compared to the previous quarter due to seasonal factors, operating profits from derivatives—such as commercial paper and equity-linked securities (ELS)—were assessed to have partially offset this decline, despite a slump in the bond sector caused by rising interest rates and foreign exchange losses of approximately 14 billion won.

Consolidated subsidiaries also contributed to the improved performance through increased valuation gains on securities driven by the strong stock market. Value Asset Management recorded a net profit of 154.9 billion won, driven by strong performance in managing its proprietary assets, while savings banks and finance companies also posted solid results due to increased valuation gains.

Analyst Jang raised this year’s net income forecast by 6.1% from the previous estimate to 3.2 trillion won, reflecting the strong second-quarter results.