September 08, 2024

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DGB Financial Group’s dividend per share is expected to rise following the sale of its indirect subsidiaries Hi Asset Management and Hi Investment & Futures, analysts said on June 3.

Its potential nonoperating income from the sell-off in the third quarter, estimated at a combined 106.2 billion won ($89.9 million), is expected to contribute to the boost.

“The sell-off is a one-time event so we have keep the target price unchanged, but it is still positive news for DGB Group investors as they can expect room for more dividends,” Choi Chung-uk, an analyst at Hana Financial Investment, wrote in a note to investors.

Choi expects the dividend yield to be 5.3 percent in 2019, up 1 percentage point on-year, and its dividend per share to reach 430 won, up 19.4 percent.

On May 23, DGB Financial Group said in a disclosure that its direct subsidiary Hi Investment & Securities had agreed to sell its entire stake -- 92.4 percent of Hi Asset Management -- to Hong Kong-based securities brokerage house Hai Tian International Securities, for 77.6 billion won.

Seoul-based BankerStreet Private Equity will ac 65.2 percent stake in another financial arm -- Hi Investment & Futures -- for 28.6 billion won.

DGB added on May 27 the deals will be sealed on Sept. 24 this year.

DGB’s nonoperating gain from the stake sell-off after tax deductions will amount to 22 billion won, according to Choi.

Hai Tian International Securities and BankerStreet Private Equtiy formed a consortium to acquire the two companies.

By Son Ji-hyoung (consnow@heraldcorp.com)