[THE INVESTOR] South Korea’s troubled shipbuilder Daewoo Shipbuilding & Marine Engineering will be hit by a liquidity crunch again in 2018 despite its ongoing self-rescue efforts and debt restructuring by creditors, report showed on Aug. 4. DSME is expected to suffer a severe liquidity shortage of 4.55 trillion won (US$4.08 billion) in 2018, according to a due diligence report on the shipbuilder conducted by Samjong KPMG, an accounting firm.  Daewoo Shipbuilding & Marine Engineering’s shipyard.T

[THE INVESTOR] Ten out of 18 South Korean top stocks by market cap in each sector generated positive returns so far this year, data showed on Aug. 4. Stock prices of 18 sector leaders listed on the country’s benchmark KOSPI rose 4.1 percent on average as of Aug 3 from a year earlier, according to data released by bourse operator Korea Exchange.  123rfThe stocks outperformed the broader KOSPI market which advanced 1.7 percent during the same period. The best performing stock was KC Tech in the me

[THE INVESTOR]South Korea’s construction companies and shipbuilders may face profit margin squeeze as overseas orders could further dry up due to a fresh oil price plunge. On Aug. 2, crude dipped below psychological level of US$40 a barrel, fueling worries for the sectors, which have suffered from the prolonged industry slump stemming from last year’s oil price fall. The Okpo shipyard of Daewoo Shipbuilding & Marine EngineeringDuring the first half of this year, South Korean builders won oversea

[THE INVESTOR] As oil prices plunged by more than a fifth in less than two months, returns on natural resources funds have turned negative, wiping out profits they made earlier this year. Some 50 fund products incorporated in South Korea, investing in commodities and stocks of natural resource-related companies, saw their average rate of returns sinking to minus 2.11 percent in the past one month, according to local financial data provider FnGuide.The commodity funds showed positive performance

[THE INVESTOR] Global oil prices may continue to slide in the second half of this year as crude entered a bearish phase again amid continuing oversupply worries, a South Korean brokerage firm NH Investment & Securities said on Aug. 3. “Oil prices are expected to move down in the short term through the end of 2016 but not below $35 a barrel,” said Ku Ja-won, an analyst at NH Investment & Securities.Crude oil futures settled below US$40 a barrel on Aug. 2 for the first time since April.The New Yor

[THE INVESTOR] South Korea’s financial industry is headed for a seismic change as the government has mapped out detailed plans to foster mega investment banks here.Experts said the move could lead the country’s major brokerages to bolster their balance sheets through capital increase as well as mergers and acquisitions in a bid to meet the requirements to offer investment banking services. On Aug. 2, the nation’s top financial regulator Financial Services Commission announced measures that enabl

[THE INVESTOR] NongHyup Financial Group logged a net loss of 200 billion won (US$180 million) in the first half of this year on loan-loss provisions it has set aside due to its heavy exposure to debt-laden shipping and shipbuilding companies.  Nonghyup‘s headquarters in central SeoulSouth Korea’s second-largest bank by assets said on Aug. 2 that it suffered a consolidated net loss of 201.3 trillion won during the first six months in 2016, including a net loss of 290 billion won in the second qua

Despite price burdens, the bond market should continue to strengthen on economic uncertainties and favorable demand-supply conditions. As such, we suggest waiting for the next base rate cut (expected in September or October) and expanding duration on KTBs upon yield rises.Global bond market outlookDeveloped markets: The yield uptrend in the US bond market (on lessening Brexit-related concerns) came to an end last week. This week, the US bond market is set to strengthen—on the recent drop in oil

[THE INVESTOR] Local customers look at Tony Moly’s products at Sephora’s main store in Paris (TonyMoly) Investors are increasingly bullish on TonyMoly, a Korean cosmetics brand, after its second-quarter earnings beat analyst’s expectations by a huge margin. Local customers look at Tony Moly’s products at Sephora’s main store in Paris. Tony MolyLocal brokerage firm Hyundai Securities has upped its price target for the cosmetics maker to 70,000 won (US$62.98) from 55,000 won while maintaining a bu

[THE INVESTOR] Meritz Real Estate Asset Management has committed some 150 billion won (US$135 million) to investing in an upscale office building in Los Angeles by raising funds from other Korean institutional investors, local newspaper reported on Aug. 2. It is the first property fund that Meritz Financial Group’s property investment unit has launched since it was established in February this year. The Gas Company Tower on Bunker Hill in downtown Los Angeles, California.Meritz RE Asset Manageme

[THE INVESTOR] The outstanding daily trading volume and its value on South Korea’s main bourse KOSPI did not record any significant changes on the first day that the country’s stock market extended trading hours by 30 minutes on Aug. 1.Cap: A worker makes a telephone call after the stock market closed at the Korea Exchange in Seoul on Aug. 1. Korea Exchange　A total of 341 million shares traded on the day worth 4.65 trillion won (US$4.29 billion), up 1.8 percent from 4.57 trillion won, an average

[THE INVESTOR] Efforts are being made to sell Hi Investment & Securities, owned by Hyundai Heavy Industries, to Chinese brokerages after it was more or less shunned by Korean firms. EY Han Young, the accounting firm managing the sale of HI Investment, requested Fosun Group, Anbang Insurance Group and other Chinese securities companies to participate in the bid for an 85.32 percent stake in the Korean brokerage house, according to a local media agency.HI Investment headquarters in Seoul. The Inve

2Q16 review: Below-consensus OP of W240.6bn (+15.6% YoY)For 2Q16, AmorePacific reported preliminary consolidated revenue of W1.44tr (+20.7% YoY), operating profit of W240.6bn (+15.6% YoY), and OP margin of 16.7%.While revenue was in line with expectations, operating profit missed our forecast and the consensus by 5.3% and 8.7%, respectively. The lower-than-expected profitability was due to negative sales growth of the domestic hypermarket channel and rising costs related to overseas expansion.Do