Korean Stock Picks (August-September 2025)

Before we get to some Korean stocks, here are a few Korean market updates from the past couple of months that were also covered in our Monday posts:

Korean Market Updates

1) Tax & Capital Markets Reforms etc.

Korea’s government wants stocks to outperform real estate:

💻 Is NPS Really Going for Board Seat Play Via Cumulative Voting? Field Check on This Narrative (Smartkarma) 31 Aug 2025 $

Short-Term, pinpointing exact tickers off this [National Pension Service] NPS/cumulative voting narrative is tough—activism risk is real, but predicting moves in governance-sensitive names is still premature.

NPS may go aggressive, potentially sparking a market-wide narrative. If limited activism unwinds, Korean stocks could see a broad re-rate, beyond just individual governance names.

Tactically, consider enhanced setups in these names under a passive framework, while closely monitoring governance developments and NPS-driven activism for actionable alpha in individual tickers.

💻 Real-Time Read on Korea’s Top Market Narrative — Tax Reform Play (Smartkarma) 18 Aug 2025 $

Even the revised draft is facing possible first-ever presidential non-approval, which acts like a de facto veto between Cabinet approval and National Assembly submission.

The admin aims to make stocks outperform real estate, with a dividend tax cut under separate taxation as the key lever, fully recognized by the Presidential Office.

Local markets are pulling back on Presidential Office delays, but signals point to a clear reform direction — time to build mid-term positions in banks and holdcos.

💻 Korea Capital Market Reform Package Just Unveiled: Korea Premium Narrative Holds (Smartkarma) 22 Aug 2025 $

M&A valuations won’t rely solely on market prices, carve-outs favor parent shareholders, and mandatory tender offers plus IPO cornerstones lead, with tender offers live H1 next year.

Commercial Act tweaks have tackled governance, and the tax reform boosts dividends. Today’s markets reform package addresses the last missing piece: giving minority shareholders a fair shake in M&A scenarios.

Details and timelines remain unclear, but the package sets a roadmap to improve Korea’s equity risk-return profile, supporting DM inclusion upside and maintaining the Korea Premium narrative.

2) Dividend Tax Plan

Korea could soon have more favorable dividend tax rules:

💻 Separate Dividend Tax Plan in Korea: A Push for a 25% Rate for Top Bracket (Douglas Research Insights) Aug 21, 2025 $

Democratic Party lawmaker Kim Hyun-jung has introduced a revised Income Tax Act that would lower the top tax rate on dividend income from 35% to 25%.

Given that this proposal is coming from the ruling Democratic Party, there is a fairly high probability that this could be passed into law in 3Q 2025.

We provide a list of 28 mid-cap/large cap stocks in Korea with more than 35% dividend payout and 3% or more dividend yield that could benefit from this new proposal.

💻 Korea’s Dividend Narrative Is Back: Unpacking the DP’s New Bill and Its Backstory (SmartKarma) 20 Aug 2025 $

A new bill cutting Korea’s dividend tax hit the tape, giving local dividend plays an immediate boost on the news flow.

The presidential office is aligned on pushing the dividend tax below the 27.5% CGT floor. The new party leader is also tightly syncing with the Blue House to avoid clashes.

The DP’s tax cut move today puts the gov’s dividend narrative back in play with juice. We need setups to ride this theme.

💻 A Hidden Trading Angle from Dividend Tax Reform: Tax Timing Creates Dividend Trap Risks (Douglas Research Insights) 06 Aug 2025 $

With new tax rules kicking in from FY2026, firms may hold back FY2025 dividends to front-load later, creating potential downside surprise purely from tax-driven deferral, not fundamentals.

If FY2025 payouts fall short, dividend names could go ex-div on inflated expectations, then trade heavy — setting up mispricing risk around year-end dividend capture trades.

This may weaken post-ex-div price rebounds, creating dividend trap risks and short-term mispricing that traders can exploit via shorts, dip buys, or dividend swap long-short strategies.

💻 Separate Dividend Tax Plan in Korea: Devil Is In the Details (Douglas Research Insights) Aug 07, 2025 $

A closer look at MOSF’s Tax Reform Plan for dividends suggests that it may not have a material impact on most listed companies unless the National Assembly drastically improves it.

According to MOSF, it currently estimates that approximately 350 of the 2,500 listed companies, or 14%, could meet these requirements (two main dividend tax reduction requirements).

We provide a list of 70 companies in the Korean stock market with 40% or higher dividend payouts (excluding companies with smaller market caps).

💻 A Disappointment in the Works for New Dividend Tax Policy in Korea? (Douglas Research Insights) Jul 30, 2025 $

There is a brewing disagreement among many members of the National Assembly in Korea regarding the new dividend tax policy.

A key controversial issue is dividend taxes on dividends exceeding 300 million won. There is a room for some disappointment in the works regarding tax reductions on dividends.

Instead of 25% tax rate for this dividend income bracket (exceeding 300 million won), there has been an increasing pressure by the ruling party to raise this rate to 35%.

💻 Disappointing New Korean Tax Policies (Dividends, Capital Gains, and Corporate Taxes) (Douglas Research Insights) Jul 31, 2025 $

The Korean government announced disappointing new tax polices for dividends, capital gains, corporate, and higher transaction taxes on securities transactions.

The new tax policies announced today is likely to have the biggest negative impact on the Korean financials with high dividend yields.

They will also likely to negatively impact other high dividend yielding stocks in Korea.

3) Mandatory Treasury Share Cancellation

Apparently there is little pushback on mandatory treasury cancellation reforms, but it might still be too early for corporate governance plays:

💻 Near-Term Flows to Watch on Mandatory Treasury Share Cancellation in Korea (Smartkarma) 26 Aug 2025 $

Dems likely to push 3rd package in Q4; near-term flows chasing treasury stock cancellation theme, with locals screening >₩1tn mkt cap, >10% treasury shares of float.

Little pushback on mandatory treasury cancellations; debate focused on timeline — grace period vs. immediate rollout — highlighting how much leeway government may grant differing governance structures.

Too early for governance plays; near-term momentum flows likely in names with highest treasury stock relative to float, where cancellation is expected to hit flows hardest.

4) North Korea Economic Reconciliation Stocks

Douglas Research Insights mentioned in June that Hyundai Elevator Co Ltd (KRX: 017800 / OTCMKTS: HYEVF) is one of best stocks to capitalize on any increased reconciliation with North Korea:

💻 Lee Jae-Myung to Meet Trump: Impact on North Korea Economic Reconciliation Stocks (Douglas Research Insights) Aug 12, 2025 $

It was reported today that the new South Korean President Lee Jae-Myung will meet US President Trump on 25 August in Washington DC.

In this insight, we discuss in particular how the meeting between Lee and Trump could lead to some outperformance of the North Korean economic reconciliation stocks.

We provide a list of 10 South Korean companies that are beneficiaries of increased economic reconciliation with North Korea. These 10 stocks are up on average 109% YTD.

5) Visa-Free Entry of Group Tourists from China

New visa policies could benefit operators of foreigner-only casinos and other tourism related businesses:

💻 Korean Government Confirms Visa-Free Entry of Group Tourists from China to South Korea (Douglas Research Insights) Aug 06, 2025 $

On 6 August, the Korean government confirmed visa-free entry of group tourists from China to South Korea.

The new policy will allow the group tourists from China to visit South Korea on a visa-free basis from 29 September 2025 to end of June 2026.

We provide a list of top 20 companies in Korea that are key beneficiaries of the no visa policy for group tour visitors from China to South Korea.

📰 Chinese tour groups to South Korea can enter visa-free from Sept 29: reports (GGRAsia) August 6, 2025

Reuters said that shares of South Korean department stores, casinos, hotels and beauty product makers rallied on Wednesday, amid hopes of a boost from Chinese demand.

Several brokerages recently mentioned that visa-free entry to South Korea for certain Chinese travellers might benefit resort operators there that run foreigner-only casinos at their venues.

Yanolja Research, a Seoul-based company, said in a February report – citing Korea Culture and Tourism Institute data and the Korean Duty-Free Shop Association – that while South Korea had a “surge” in tourist arrivals in 2024, tourism income had “stagnated”.

6) When Will Korean Investors Bail on the MAG7?

Some of the previously mentioned reforms might help convince Korean investors to invest in local stocks rather than the MAG7:

💻 7 Main Reasons Driving Surging Ownership into MAG7 Stocks by Korean Investors: When Will They Sell? (Douglas Research Insights) Aug 30, 2025 $

In this insight, we discuss the sharp capital flight out of Korea into major stocks in the US in the past several years, especially into the MAG7 stocks.

We provide seven major reasons why Koreans’ investments in the US stocks (especially MAG7) have been surging in the past several years.

When will they sell? We provide some clues on this.

7) US Tariffs & Immigration Raids on Korean Companies

There is still some uncertainty on the tariff front while I am not particularly surprised that Korean companies might not have their employees on proper visas in the USA:

💻 US Tariffs on Imports from Japan Lowered to 15% but Imports from Korea Are Unchanged at 25% – Why? (Douglas Research Insights) Sep 10, 2025 $

One of the biggest events in Korea in the past week has been the uncertainty regarding the US tariffs on South Korea which remains unchanged at 25%.

On top of this, it was reported on 9 September that the US tariffs on Japanese goods including cars and auto parts will be lowered to 15% by 16 September.

If Lee’s approval rating falls to about 45% to 50% range, then there could be a greater urgency by the Korean government to finalize a trade deal with the US.

📰 Korean companies admit cutting corners on US visas but say they have little choice (FT) 9 Sep 2025 $ 🗃️

Conglomerates shaken by immigration raid on Hyundai site

South Korean companies have routinely used unsuitable visas for workers sent to the US to build multibillion-dollar advanced manufacturing sites, according to Seoul-based executives and industry groups.

August & September Korean Stocks

Korean stocks from a variety of research sources covered in the rest of this post for August & September (but with up-to-date charts and key data):

[Note: On desktop browsers, an autogenerated table of contents will appear on the left side linked to each stock. I will add those links below after publishing/emailing this post…]

September 2025 – Hyundai Steel, POSCO Holdings, APR, CJ Logistics, HanAll Biopharma, Hyundai Glovis, Samsung Electronics, Hotel Shilla, Netmarble, Cafe24, Kakao Corp, NAVER, L&F Co Ltd, HMM, CJ ENM, Studio Dragon, Samsung Electro-Mechanics, SK Hynix, SK Inc & SNT Motiv

August 2025 – BH Co Ltd, Iljin Hysolus, HD Hyundai Heavy Industries, KoMiCo, Samsung SDI, Samsung Biologics, Krafton Inc, Samsung E&A, Daewoo E&C, Sanil Electric, CJ Corp, Youngone Corp, Dentium, LIG Nex1, SK Oceanplant, Hanon Systems, SK REIT, Dio Corp, Seegene, InBody, JYP Entertainment, People & Technology, KEPCO, PearlAbyss Corp, Hanssem, Classys, Vatech, PharmaResearch, NCsoft, Shift Up, Jin Air, Cosmax, Cosmecca Korea, Shinsegae, Kolmar Korea, Wemade, Korea Gas Corporation (KOGAS), Neowiz, CS Wind, Lotte Chemical, LG Chem, Koh Young Technology, KEPCO Plant Service & Engineering Co Ltd, Kakao Games, LG Chem Ltd, SM Entertainment, Korea Investment Holdings, HYBE, Hyundai Department Store, Korea Zinc Inc, Hugel, SK Biopharmaceuticals, Dear U, Hyundai Rotem, i-SENS, Vieworks, Lotte Chilsung Beverage, Chong Kun Dang Pharmaceutical Corp, HD Hyundai Mipo, Kumho Petrochemical, Amorepacific Corp, LX International, Pan Ocean, POSCO International, DL E&C, F&F Co, Hanwha Systems, Hanwha Aerospace, LG H&H & BNK Financial Group

Readers can decide whether these DeepSeek insights about these stocks are accurate:

🤖 DeepSeek Analysis

Note that our 🇰🇷 Korea index now has 290 Korean stocks (Previous Korean stock pick posts: 2023: May, June, July, August, September, October & November-December / 2024: January, February, March-April, May, June, July-August, September, October, November & December / 2025: January, February, March, April, May & June-July) with more covered in our Monday posts not yet added to the index.

And as always, this post is provided for informational purposes only (and to make your life easier…). It does not constitute investment advice and/or a recommendation…

🔬 Research analysis (including articles/blog posts from fund managers, etc.); 🎥 Video; 🎙️ Podcast; 🎬 Webinar; 📰 Newspaper/magazine article; 📯 Press release; 💻 Substack/blog/website article; ✅ Our own posts; 🗃️ Archived article; ⏰ Upcoming webinar or event; ⚠️ Disclosures or restricted access e.g. based on your location, investor status, etc.; 🇼 Wikipedia page; 🏷️ Tagged links to other posts about the stock.

Japan, Korea & Taiwan Stock Index

Frontier & Emerging Market Stock Index

September 2025

Hyundai Steel

🔬 Hyundai Steel (004020 KS/Buy) – Likely to swing to black on a standalone basis (Mirae Asset Securities) 09.30.2025 ⚠️

🌐 Hyundai Steel Co (KRX: 004020) – Steel products e.g. H-beams, rail & reinforcing bars, hot coil, cold-rolled steel, stainless cold-rolled sheet, etc. 🇼 🏷️
Price/Book (Current): 0.23
Forward P/E: 5.21 / Forward Annual Dividend Yield: 2.25% (Yahoo! Finance)

POSCO Holdings

🔬 POSCO Holdings (005490 KS/Buy) – Solid steel performance vs. uncertain subsidiary earnings (Mirae Asset Securities) 09.30.2025 ⚠️

🔬 POSCO Holdings (005490 KS/Buy) – Steel was the lone bright spot in 2Q25 (Mirae Asset Securities) 08.01.2025 ⚠️

🌐 POSCO Holdings (NYSE: PKX) – Integrated steel producer. 6 segments: Steel, Trading, Construction, Logistics & Others, Green Materials & Energy & Others. 🇼 🏷️
Price/Book (Current): 0.38
Trailing P/E: 39.81 (no forward P/E) / Forward Annual Dividend Yield: 3.70% (Yahoo! Finance)

APR

🔬 APR (278470 KS/Buy) – Devices to emerge as an additional growth driver (Mirae Asset Securities) 09.29.2025 ⚠️

🔬 APR (278470 KS/Buy) – Undisputed leader in Korean beauty (Mirae Asset Securities) 08.07.2025 ⚠️

🌐 APR Co Ltd (KRX: 278470) – Global beauty tech D2C company. Offers medical cosmetics & diet products; operates instant photo booths + caps, sweat shirts & track tops through its online store. 🏷️
Price/Book (Current): 23.39
Forward P/E: 26.67 / Forward Annual Dividend Yield: 2.82% (Yahoo! Finance)

CJ Logistics

🔬 CJ Logistics (000120 KS/Buy) – Unrivalled 3PL player (Mirae Asset Securities) 09.26.2025 ⚠️

🔬 CJ Logistics (000120 KS/Buy) – Ability to defend market share partially confirmed (Mirae Asset Securities) 08.11.2025 ⚠️

🌐 CJ Logistics (KRX: 000120) – Oldest & largest parcel delivery firm in Korea. Integrated transportation & logistics services. 🇼 🏷️
Price/Book (Current): 0.42
Forward P/E: 8.86 / Forward Annual Dividend Yield: 0.95% (Yahoo! Finance)

HanAll Biopharma

🔬 HanAll Biopharma (009420 KS/Buy) – Promising batoclimab results heighten expectations for IMVT-1402 (Mirae Asset Securities) 09.25.2025 ⚠️

🌐 HanAll Biopharma (KRX: 009420) – Specialty drugs & over-the-counter products. 🏷️
Price/Book (Current): 11.31
Trailing P/E: 790.91 (no forward P/E) / Forward Annual Dividend Yield: N/A (Yahoo! Finance)