Korea Zinc, Young Poong stocks soar for second straight day

Park Ki-deok, CEO of Korea Zinc, speaks during a press conference at a hotel in Seoul on the morning of the 22nd. (Joint Press Corps)

Korea Zinc Inc. saw its stock price heading toward the upper limit for a second consecutive day on early Friday. The South Korean non-ferrous metal smelting company is currently in a management dispute with the alliance of private equity firm MBK Partners and Young Poong Corp.

Korea Zinc shares were trading at 1.43 million won ($1,036.28) as of 9:10 a.m. on Friday, up 25.48 percent from the previous day. Earlier, the stock hit an all-time high of 1.47 million won with a 29.17 percent increase.

The company‘s stock price had soared to the daily price limit of 1.14 million won on Thursday, a day after the conclusion of its share buyback offer.

The company’s market capitalization, which had risen to the 13th largest in the main Kospi market the previous day, rose to 10th place on Friday.

Shares of Young Poong Precision Corp., which holds a 1.85 percent stake in Korea Zinc. and plays a key role in the dispute, also saw a sharp rise for the second consecutive day on Friday.

The stock was trading 21.15 percent higher at 31,500 won from the previous day, after closing at the daily limit of 26,000 won the previous day.

It is speculated that Korea Zinc Chairman Choi Yoon-beom will be able to increase his stake in the company to 36.49 percent with his ally Bain Capital, including the results of the share buyback that ended on Wednesday.

The Young Poong-MBK alliance, which completed its own tender offer earlier, has increased its stake to 38.47 percent.

If Korea Zinc proceeds with canceling the treasury shares acquired through the buyback, Choi’s side could hold 40.27 percent, while the alliance’s stake could rise to 42.74 percent.

Since both sides have failed to secured a stable majority stake even after their respective tender offers, it is expected that they will continue to engage in competition for shares through additional stock purchases and the acquisition of friendly shares.

With the reduction in market circulation volume, Korea Zinc’s stock price is expected to continue to surge.

Meanwhile, KB Financial Group’s stock price hit a record high in early trading on Friday, driven by strong third-quarter earnings and value-up expectations.

KB Financial shares were trading at 100,400 won as of 9:44 a.m., up 7.73 percent from the previous session after reaching 103,900 won at one point during the session.

According to the Korea Exchange, this is the highest price since its listing on October 10t, 2008.

KB Financial Group announced on Thursday that its third-quarter net profit attributable to controlling shareholders had increased by 17.5 percent year-on-year to 1.61 trillion won, marking the largest third-quarter figure in the company’s history.

The company also unveiled a value-up plan to return surplus capital exceeding its 13 percent Common Equity Tier 1 (CET1) ratio to shareholders starting in 2025.

This plan includes cash dividends and share buybacks and cancellations, with a total shareholder return rate set to remain at the highest level in the industry.

Securities firms responded positively to KB Financial‘s strong performance and value-up plan, with many raising their target stock prices.

“The company exceeded expectations in terms of performance, shareholder returns, and value-up announcements,” Hana Securities Co. analyst Choi Jung-wook said. “As the company strives to manage its CET1 ratio to increase shareholder returns, any future increases in the ratio could further amplify market expectations, which is quite positive for the market.”

He raised his target price for the company from 110,000 won to 115,000 won.