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Photo = Doosan Robotics |
[Alpha Biz= Kim Sangjin] On Monday, iM Securities maintained its "Buy" rating for Doosan, citing expectations of expanded shareholder returns due to the implementation of improved treasury stock regulations. The target price was raised from 265,000 won to 350,000 won.
iM Securities stated, "The new treasury stock reforms will curb the misuse of treasury shares as a tool to reinforce the controlling shareholder’s influence. This development is expected to lead to expanded shareholder returns, such as treasury stock cancellations, for Doosan."
The revised enforcement decree of the Capital Market Act, introduced by financial authorities, came into effect on December 31, 2023. Key measures include banning the allocation of new shares for treasury stocks during corporate spin-offs or mergers, requiring disclosure of plans if more than 5% of total issued shares are held as treasury stock, and strengthening public disclosure requirements for all treasury stock disposals and trust-related acquisitions or sales.
iM Securities highlighted Doosan’s shareholder composition as of the end of September 2023: Park Jeong-won and related parties held 40.0%, the National Pension Service held 8.2%, treasury stock accounted for 18.2%, and others held 33.6%. The firm explained, "The mandatory board approval and disclosure of Doosan's treasury stock holdings, purposes, and future plans may result in the cancellation of a portion of the 18.2% treasury stock."
Additionally, the introduction of fiduciary duties for directors is seen as a potential boon for Doosan. iM Securities noted, "For holding companies like Doosan, liquidity discounts caused by dual listings of the holding company and subsidiaries often create conflicts of interest between controlling shareholders and minority shareholders. The adoption of fiduciary duties for directors is likely to improve corporate governance and make holding companies such as Doosan significant beneficiaries of this reform."
AlphaBIZ Kim SangJin(letyou@alphabiz.co.kr)
