Big Players Managing 2,350 Trillion KRW Snap Up Korean Stocks... The Untold Strategy Retail Investors Haven't Noticed Yet [Weekend Money]

BlackRock Raises Stake to 7% in HLB and 6% in Yuhan Corporation
Kopernik, BOLD, and Others Also Expand Their Holdings in Chong Kun Dang and Olix
"Focus Shifting to Undervalued Firms With Strong Cash Flow Potential"

Cases of global major asset management firms investing in and expanding their stakes in domestic pharmaceutical and biotechnology companies are on the rise. On the 16th, Kiwoom Securities noted that while it cannot completely rule out mechanical index investments, it is noteworthy that undervalued companies are attracting increased attention.

Cases of major global asset management firms investing in and increasing their stakes in domestic pharmaceutical and biotechnology companies are on the rise. Getty Images

BlackRock, the world's largest asset management firm, increased its stake in HLB to above 5% in March, then further expanded it to 6.05% in June, and 7.15% in August. BlackRock's stake in Yuhan Corporation, which was newly disclosed at 5.07% in June, was increased again this month to 6.5%. Its stake in Alteogen was also newly disclosed at 5.03% this month.

As of the end of the second quarter, BlackRock's assets under management stood at approximately USD 15.34 trillion (about KRW 2,350 trillion).

In addition to BlackRock, investments from other overseas asset management firms are also increasing. U.S.-based asset manager Kopernik Global Investors increased its stake in Chong Kun Dang from 7.21% to 8.38%. In June, Olix attracted an investment of about KRW 110 billion through a third-party paid-in capital increase, with participation from L'Oréal Group's venture fund BOLD and U.S. asset manager Weiss Asset Management.

Photo by Google Gemini generated

Because BlackRock manages large amounts of ETF and index funds, not all of its recent stake increases in domestic biotechnology companies can be interpreted as active investments. However, Kiwoom Securities emphasized that one should pay attention to changing perspectives regarding domestic biotechnology companies among target firms for investment.

Kopernik Global Investors, which holds more than 8% of Chong Kun Dang, is known for its value investing strategy focused on undervalued assets. Overseas asset managers have also identified Alteogen—expected to benefit from the commercialization of Keytruda SC (subcutaneous injection); Yuhan Corporation—set to expand global sales of its new lung cancer drug Leclaza; and Olix—a company expected to improve its cash flow through technology transfer and commercialization, resulting in royalties or milestone payments.

Huh Hyemin, a researcher at Kiwoom Securities, commented, "It is notable that overseas investors' interest is expanding beyond past approaches that focused solely on potential clinical success, now targeting undervalued companies or those with a high potential for the actual generation of cash flow."

She added, "It is also a positive sign that domestic companies' non-deal roadshows (NDRs) and meetings with global investors are becoming more active, and, as a result, investment by overseas funds in domestic pharmaceutical and biotechnology companies is expected to further expand in the future."

This content was produced with the assistance of AI translation services.