Hanwha Life, Hyundai Steel, Lotte Shopping among 151 firms flagged for persistently low valuations

Hanwha Life Insurance, Hyundai Steel and Lotte Shopping are among 151 companies publicly flagged by the Korea Exchange for their persistently low valuations. The bourse operator revealed the list Sunday in an unprecedented move aimed at pushing listed firms to improve their corporate value.

The initiative targets companies that have consistently traded at low price-to-book ratios (PBRs) while doing little to return capital to shareholders. Whether the public disclosure will spur them to take concrete steps to boost their valuations and help narrow the so-called "Korea discount" remains to be seen.

The list comprises 96 KOSPI-listed companies and 55 on the Kosdaq that ranked in the bottom 25 percent and 10 percent, respectively, of their markets in terms of PBR over the past three years.

PBR measures a company's market capitalization relative to its net assets, showing how much investors are willing to pay for each unit of book value. A ratio below 1 means the company is valued at less than its net assets, potentially reflecting concerns about its growth prospects or how efficiently it deploys capital.

Several companies with market capitalizations exceeding 1 trillion won ($750 million) made the list, including Hyundai Steel, Emart, Lotte Shopping and Lotte Chemical.

Four financial firms were also included: Hanwha Life, with a market capitalization of more than 3.5 trillion won, the largest among the designated companies, as well as DB Securities, Hyundai Motor Securities and Heungkuk Fire & Marine Insurance.

The names will be available on the Korea Exchange's stock market disclosure and information portal from Monday through May 4, 2027, and will carry a “low PBR” tag on securities firms' trading platforms.

The exchange plans to update the list every May and November. Beginning next year, it will also provide one-on-one consulting for selected firms to help them identify the causes of their low valuations and establish targets and plans for improvement.

The disclosure puts listed firms' corporate value-up initiatives under closer scrutiny, raising expectations that they will move beyond mere pledges and demonstrate tangible results. Ultimately, a lasting revaluation will require stronger profitability, more efficient capital allocation and greater shareholder returns.

“Even companies that have been reluctant to return capital to shareholders may feel compelled to reconsider their approach once they appear on the low-PBR list,” said Na Jeong-hwan, a strategist at NH Investment & Securities. “Investors should watch for those that respond to the disclosure by stepping up their corporate value-up announcements.”