Meritz Securities to acquire Meritz Capital for large IB ... Target Price ↑

IBK Investment & Securities has revised up its target price on the 26th by evaluating the adjusted balance sheet after Meritz Capital acquired Meritz Securities. We reiterate Buy with a target price of W5,300.

Meritz Securities recorded 1Q earnings surprise. Net income (consolidated basis) increased 40.7% QoQ and 61.0% QoQ to W80.9bn.

Kim Ji-young, a researcher at IBK Investment & Securities, said, 'Despite the slight increase in average daily trading value,

Net trading revenue rose 31.0% QoQ to W108.7bn, thanks to strong trading and wholesale sectors.

(NIM) due to investment review and business dealings (Sourcing) rose 14bp QoQ. "

In addition, we focused on three points as investment points for Meritz Securities.

Kim said, "The expansion of equity capital through the acquisition of capital by Meritz Securities in order to go to large IB from the perspective that the growth of the company leads the profit is positive because it is expected to grow in the future."

If the dividend payout ratio remains above 33% this year, as the company has already maintained high dividend payout ratio, as Meritz Securities is already diversifying its earnings with the "choice and focus" strategy of small and mid-sized brokerage firms, And 5.6% of dividend yield. "



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