Singapore's government and sovereign wealth fund GIC reduced their stakes in HD Hyundai Marine Solution and Cosmax starting end of June, according to financial investment industry sources. The two entities selectively trimmed positions in these stocks while maintaining their holdings above 5% in other Korean equities including Samsung Heavy Industries and LIG Defense & Aerospace. The stake reductions occurred before the KOSPI index experienced a sharp decline in July, with total transaction values reaching approximately 320 billion won across the two stocks.
GIC and Singapore Government Reduce HD Hyundai Marine Solution Stakes
GIC lowered its stake in HD Hyundai Marine Solution from 5.001% (2,242,203 shares) to 3.996% (1,791,750 shares) through on-market sales starting end of June. The disposal amounted to approximately 100 billion won based on transaction prices.
Singapore's government also reduced its position from above 5% to 3.976% (1,782,492 shares). The government had previously increased its stake through on-market purchases since end of last year. Approximately 200 billion won worth of shares were sold on-market.
Stake Reductions in Cosmax Totaled 50 Billion Won
GIC disposed of 115,710 Cosmax shares through consistent on-market sales starting end of June, estimated at approximately 20 billion won. The fund's shareholding decreased from 5.314% (603,144 shares) to 4.295% (487,434 shares) by early last month.
Singapore's government began selling Cosmax shares on-market in February, disposing of 121,874 shares totaling approximately 30 billion won. Its stake declined from 5.397% (612,490 shares) to 4.323% (490,616 shares).
Both entities focused profit-taking on the two stocks that had recorded annual highs at end of April before the Korean market's decline.
HD Hyundai Marine Solution Fell 12.9% While Cosmax Rose 23.1%
HD Hyundai Marine Solution declined approximately 12.9% in July. Brokerages began lowering expectations for the stock since last month, reflecting pessimism about second-quarter results.
Cosmax rose approximately 23.1% during the same period. The stock attracted divergent brokerage views as expectations for the global cosmetics industry outlook continued despite concerns about domestic margin improvement speed.
Brokerages Adjusted Target Prices Following Q2 Results
Korea Investment & Securities lowered HD Hyundai Marine Solution's target price to 260,000 won on the 10th of last month. Yuanta Securities and Sangsangin Securities subsequently reduced targets to 412,000 won and 100,000 won respectively.
After second-quarter results fell below market expectations, SK Securities and Hyundai Motor Securities made additional downward adjustments to 110,000 won and 82,000 won respectively.
For Cosmax, Hyundai Motor Securities lowered its target price to 240,000 won. Samsung Securities and NH Investment & Securities raised targets to 230,000 won and 260,000 won respectively. Shinhan Investment Securities upgraded its investment opinion to 'Buy'.
Cosmax also saw the National Pension Service and Norway's Government Pension Fund Global (NBIM) increase their stakes at end of June, contrasting with the Singapore-based funds' reductions during the same period.
FAQ
What stakes did GIC and Singapore's government reduce in Korean stocks?
GIC reduced its HD Hyundai Marine Solution stake from 5.001% to 3.996% starting end of June, disposing of approximately 100 billion won worth of shares. Singapore's government lowered its HD Hyundai Marine Solution position to 3.976%, selling approximately 200 billion won on-market. Both entities also reduced Cosmax holdings, with GIC cutting from 5.314% to 4.295% and Singapore's government from 5.397% to 4.323%, totaling approximately 50 billion won in combined sales.
How did HD Hyundai Marine Solution and Cosmax stocks perform after the stake reductions?
HD Hyundai Marine Solution declined approximately 12.9% in July following the stake reductions. Multiple brokerages lowered target prices after second-quarter results fell below market expectations. Cosmax rose approximately 23.1% during the same period, with some brokerages raising target prices based on expectations for the global cosmetics industry outlook.
