– As KOSPI continues to move sideways at the 3100 line this month, stocks bought by pension funds and other corporations are attracting attention. Pension funds are regarded as institutional investors who predict and invest in the direction of how the stock market will flow along with investment trusts. Other corporations, excluding financial companies, invest to generate their own profits, so they can be useful for stock market judgment. This is why stocks held by pension funds and other corporations are attracting attention amid the prolonged KOSPI sideways.
According to the Korea Exchange on the 9th, until the 9th of this year, pension funds had the largest net purchase of Big Hit. During this period, the pension fund purchased Big Hit worth 1137 billion won. This was followed by Samsung Biologics, Kiwoom Securities, and LG Display. All of these are stocks that either announced surprise results in the fourth quarter of last year or are expected to perform well. Pension funds sold 10,172 trillion won in the securities market only this year, and it appears that’performing stocks’ were net bought even in the midst of this. Last year’s annual performance was higher than expected, recording an’earning surprise’ or buying a large number of stocks that are expected to rebound this year. Samsung Biologics recorded an operating profit of 92.6 billion won in the fourth quarter of last year. According to Yuanta Securities, this exceeded the market forecast (consensus) for six consecutive quarters. LG Display also recorded an operating profit of 685.5 billion won in the fourth quarter of last year, turning to the black compared to the same period last year. LG Display achieved surprise results with surplus for two consecutive quarters. LG Innotek, which ranked 9th in net purchase of pension funds, also announced its record-high quarterly results in the fourth quarter.
In addition, the stocks purchased from pension funds are estimated to have recorded good performance in the fourth quarter of last year. According to F&Guide, a financial information company, Big Hit is expected to have an operating profit of 55.9 billion won in the fourth quarter. This is a 136.9% increase from the same period last year (23.6 billion won). Kiwoom Securities is also expected to see an operating profit of 2351 billion won in 4Q, up 95.9% YoY.
Choi Yoo-jun, a researcher at Shinhan Investment Corp. said, “It seems that pension funds have been net purchases of stocks whose profits are turning around while supply and demand have been vacant.” “It is an industry that is evaluated to have risen less than the stock market was booming,” he said.
Other corporations are also showing their presence this year. Other corporations refer to domestic corporations not included in institutional investors. It is generally interpreted by the market as a non-financial company, but when companies buy treasury stock, it is also considered other corporations. When companies directly purchase stocks, it is interpreted that they see the future value of the stock highly. According to the exchange, this year, other corporations made net purchases worth 242 billion won in the securities market. This is insignificant considering that individual investors net bought 23,693.3 billion won during this period, but it is useful in the sense that companies with bright inside information made direct investments. Until the 9th of this year, Samsung Electronics, which was the most net-purchased stock of other corporations, bought 193.5 billion won worth of stock. This year, Samsung Electronics’ share price rose 2.1%, falling below the KOSPI increase rate of 7.35%, but it means that companies still see high future value. Other subsidiaries also bought LG Electronics (51.7 billion won) and Hyundai Mobis (371 billion won) after Samsung Electronics. Considering that these companies have not disclosed their share buyback this year, it can be interpreted that non-financial companies have started investing in anticipation of an increase in share prices.
However, stock prices are expected to continue selling pension funds until the first half of this year to reduce the share of stocks. NH Investment & Securities analyzed that despite the recent net selling, the pension funds still exceeded the target share of domestic stocks this year. Noh-gil, a researcher at NH Investment & Securities, said, “Assuming that the current KOSPI level is maintained, net sales of pension funds available until the end of the year are estimated at KRW 30 trillion. The pace will slow down before June,” he analyzed.
[김규식 기자 / 신유경 기자]
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