South Korean corporate reforms hit rough patch as Samsung digs in
South Korea’s market remains one of the world’s cheapest.
South Korean conglomerates are facing investor pressure to accelerate corporate governance reforms despite a strong market rally. The KOSPI index has risen 35% this year, but trades at a low forward P/E ratio of 3.85 times, far lower than global averages. Samsung Electronics, the country's largest tech firm, has reported record profits but trades at just 1.87 times book value.
The company's board chairman met overseas investors before its earnings announcement, responding to complaints about modest returns and suggesting share buybacks instead. However, large chaebol affiliates are resisting reforms, raising concerns that progress on President Lee Jae Myung's goal to eliminate the "Korea Discount" may stall.
Critics argue that Samsung should return more profits to shareholders and simplify its corporate structure.
Written by urgent.news from Straits Times Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
