Kangwon Land Jumps After Pyeongchang Wins Winter Olympics
Kangwon Land Inc. (035250), a South Korean casino and hotels operator, surged in Seoul trading after the 2018 Winter Olympics were awarded to a town in the province where the company is based.
Stocks of construction, cement, resort and design companies also rose on the Korea Exchange after Pyeongchang, in the Taebaek mountains about 130 kilometers (80 miles) east of Seoul, beat Munich and France’s Annecy to host the Games.
Kangwon Land, which also has a ski resort and golf course, rallied as much as 9.5 percent before trading 3.1 percent higher at 30,000 won as of 10:19 a.m. in Seoul.
The Winter Olympics will make it easier for Kangwon Land, an importance source of tax revenue for Gangwon province, to expand in the region, according to Shinhan Investment Corp. Expected investments in transportation infrastructure will also improve access to Kangwon Land’s facilities, the brokerage said in a report today.
“The event will help the company attract more visitors and therefore boost sales,” Sung June Won, a Shinhan analyst, wrote in the report.
Hosting the 2018 Winter Olympics will directly add 21.1 trillion won ($19.8 billion) to the South Korean economy, Hyundai Research Institute said in a report published this week. Benefits from increased tourism and raising the profile of the nation and its corporate brands will indirectly add a further 43.8 trillion won to the economy in the 10 years after the Olympics, according to the report.
Stocks of South Korean builders also advanced on speculation the sporting event will help boost domestic orders.
“Contracts for infrastructure and stadiums will come, which should be positive for builders whose domestic orders have been a bit lackluster,” Han Jong Hyo, an analyst with Shinyoung Securities Co., said by phone today.
Heerim Architects & Planners (037440), which won a contract to design a stadium for the 2014 Incheon Asian Games, rose 1.3 percent, while Freedom Travel Co., which is building a resort in Pyeongchang, added 4.9 percent.
Hyundai Cement Co., which has operations including a ski resort in Gangwon province, surged by the daily limit of 15 percent. Ssangyong Cement Industrial Co. added 4.9 percent.
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