[Edaily Reporter Kwon Oh Seok ] Shinhan Investment Securities announced on the 2nd that it is maintaining its “Buy” rating and target price of 1,800 won for KOREIT(034830).

Kim Seon-mi, an analyst at Shinhan Investment Securities, stated, “Although first-half earnings were disappointing, the potential for medium- to long-term earnings growth remains valid when considering the recovering pre-sale rate (average pre-sale rate of 50% for the first half), an increase in urban redevelopment project orders, and participation in anchor REITs.” "While the stock is unlikely to emerge as a top pick in terms of short-term price momentum amid rising expectations for a housing market recovery, we expect the stock price to follow a gradual upward trend alongside improving earnings," she analyzed.
Cumulative revenue for the first half totaled 98.9 billion won, and operating profit stood at 4.9 billion won, recording results that fell short of expectations. Analyst Kim explained, “In addition to somewhat sluggish revenue recognition from pre-sales due to low initial sales rates at pre-sale sites in 2025–2026, this was also influenced by the reflection of one-time costs, such as investment losses at the consolidated subsidiary (Coreate).”
Nevertheless, he expects performance to improve gradually. He emphasized, “Sales rates at development sites from the second half of 2025 through 2026 are recovering smoothly, and construction is scheduled to begin in the third quarter on major urban renewal projects such as Eulseok and Singil,” adding, “We expect an increase in commission revenue from the REIT division’s asset acquisition and disposal plans.”
He continued, “Considering the investment losses recognized in the first half, the initial operating profit forecast of over 40 billion won has been revised downward, but expectations for year-over-year earnings growth remain valid.” He noted, “Unlike last year, when KOREIT dominated the market, ‘leveraged trust orders’ have shown weakness this year due to increased bidding from competitors. “On the other hand, we expect to secure over 100 billion won in orders this year for urban redevelopment projects, which are a key area of our business,” he said.
Furthermore, he added, “Through Anchor REIT, established in August, we have secured: △ annual management fees of 3 billion won; △ asset acquisition and management fees when investing in Jari REIT; △ an equity investment return of 9–10%; and △ the potential for contracts linked to development REITs,” noting, “We are also laying the groundwork to reduce earnings volatility caused by industry conditions over the medium to long term.”