"iM Financial Group's Shareholder Return Yield at 8%... Strong Downside Support for the Stock"[Click-e-Stock]

On August 5, LS Securities stated that iM Financial Group is maintaining its trend of expanding shareholder returns, including additional share buybacks and cancellations in the second half of the year, and assessed that the stock remains undervalued. The target price was set at 22,000 won, with a 'Buy' investment opinion maintained.

According to analyst Jeon Bae-seung of LS Securities, in a report released today, "iM Financial Group's consolidated net profit for the second quarter of this year recorded 141.1 billion won, a decrease of 9.0% compared to the same period last year, which met market expectations." He added, "Driven by interest income growth and expanded fee income, total operating income increased by 3.3% year-on-year to 559 billion won, but net profit declined due to a significant rise in SG&A expenses, including education tax and bonuses."

The outlook for earnings and shareholder returns in the second half of the year is seen as positive. Jeon said, "While bank loan growth continues, the effect of enhanced capital ratios following active growth policies is becoming apparent, which is leading to an expansion in the scale of shareholder returns." He predicted, "In addition to the 40 billion won in share buybacks and cancellations in the first half, an additional 30 billion won will be carried out in the second half, and the year-end dividend will significantly increase to maximize the effect of the dividend reduction." Accordingly, the total shareholder return ratio is estimated to rise sharply from 38.8% last year to 43.3% this year.

Jeon also noted, "Although the pace of improvement in return on equity (ROE) is slower than expected, the current stock price is significantly undervalued, with a price-to-book ratio (PBR) of less than 0.5 times." He added, "The expected shareholder return yield for this year is 8%, indicating very strong downside support for the stock."

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