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[Alpha Biz=(Chicago) Reporter Kim Jisun] Hi Investment & Securities pointed out on the 10th that LG Group's holding company, LG, has "no growth momentum." The target price remained at 106,000 won.
Hi Investment & Securities analyzed that although LG announced shareholder return measures, stock prices have not been on the rise due to the lack of mid- to long-term growth strategies.
In May last year, LG announced a plan to enhance its mid- to long-term shareholder value, including an improvement in dividend policy and acquisition of treasury stocks. As a plan to improve its dividend policy, the government will remove the limit of "limit on dividend income" from its existing dividend policy, which calls for "returning more than 50 percent of its net profit based on separate financial statements to shareholders to the limit of dividend income." In addition, treasury stocks will be acquired at 500 billion won by the end of 2024.
"The reason why such treasury stock purchases only serve as a defense against falling stock prices due to supply and demand factors and do not lead to mid- to long-term upward momentum in stock prices is because it is difficult for shareholders to clearly know how to use them after the buyback," said Hi Investment & Securities Co.
Five major LG companies were incorporated into the new company, LX Holdings, through a personnel division in May 2021, but no new investment has been made.
Hi Investment & Securities said, "In order for unique growth momentum to occur, action is need
AlphaBIZ 김지선(stockmk2020@alphabiz.co.kr)
