Shares of KT Corp. have been suffering a sharp decline as South Korea’s No. 2 mobile carrier braces for a triple whammy of increasingly negative earnings outlook, worsening business conditions and a loss of trust, analysts said Thursday.
KT shares rebounded from the previous session’s dip, closing at 29,000 won ($27) on the Seoul bourse, up 2.47 percent. On Wednesday, KT hit a yearly low of 28,300 won.
KT has been on a downward spiral since late last year when its former president stepped down amid reports of political pressure. Founded as a public corporation, KT became a private entity in 2002 but has not been free from political influence.
Former Samsung Electronics President Hwang Chang-kyu took the helm of the telecom giant in January, but investors opted to sell their KT shares.
“Most of all, earnings concerns weigh down KT,” said Kang Bong-woo, an analyst at LIG Investment & Securities. “Adding to this, investors are worrying about KT losing its credibility on a series of bad things and unfavorable business environment.”
KT, the last among the country’s top three mobile carriers to introduce the fourth-generation service, has been ramping up efforts to catch up to its major rivals SK Telecom Co. and LG Uplus Corp.
Its efforts to woo more subscribers for so-called long-term evolution (LTE) services, however, did not help improve its overall bottom line.
Hit by a decline in revenue from the fixed-line business and a strong competition in the LTE service, KT suffered an operating loss of 149 billion won during the fourth quarter of last year. (Yonhap)
