Korea Pension Boosts Stake in Six Firms as Disclosure Rule Eased
South Korea’s National Pension Service increased its holdings in six local companies to more than 10 percent after the government eased disclosure requirements for the country’s biggest investor last month.
The companies included Samsung C&T Corp. (000830), which helped build the world’s tallest building in Dubai, Mando Corp. (060980) and LS Corp. (006260), the NPS said in regulatory filings. Samsung C&T gained 1.7 percent to its highest close in three months. Mando, South Korea’s third-largest auto-parts maker, rose 1.2 percent at the close in Seoul. The benchmark Kospi index rose 1 percent.
The state pension fund gained more scope to increase stakes after new rules that took effect on Aug. 29 lengthened the timing of public filings for transactions above 10 percent to once a quarter from within five days. The NPS has said it will continue disclosing stakes within five days when they first breach the 10 percent level.
“The six companies were picked to be included in the pension fund’s buying list because of their attractive valuations and solid earnings outlooks for the second half,” Im Jeong Jae, a money manager at Shinhan BNP Paribas Asset Management Co., which oversees about $28 billion, said in an interview in Seoul today. “This is not the end of the list as the agency will continue to buy above the 10 percent threshold as it is given more freedom.”
NPS also held more than 10 percent of SKC Co., IsuPetasys Co., a components maker, and Hansol CSN (009180) Co., according to the filings.
Samsung C&T dropped 9 percent in 2013 and trades for 21 times estimated earnings for the next 12 months, down from a multiple of about 25 in April 2012, according to data compiled by Bloomberg. Mando trades for 9.2 times estimated 12-month earnings, compared to Japan-based Denso Corp. (6902)’s 14 times.
To contact the reporter on this story: Sharon Cho in Seoul at firstname.lastname@example.org