KOSPIFinance001750

Hanyang Securities

₩19,190▲ 0.16%2026-10-02 close

Market Cap

₩290B

Turnover

₩39,189,420

Volume

2,044 shares

Shares out.

15.1M

PER

4.2×

PBR

0.4×

EPS

₩4,656

Dividend Yield

8.23%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩1,600 per share · Prices as of the 2026-10-02 close

Report overview

Earnings Diversify as JoongAng Group Risk Lingers

Hanyang Securities continues an earnings recovery led by trading and retail while diversifying its business, but it also carries risk from JoongAng Group-related exposure and a regulatory inspection.

1
In June 2025, KCGI acquired a 29.59% stake from the Hanyang University foundation to become the largest shareholder, setting a mid-to-long-term goal of 1 trillion won in equity capital.
2
In 2025, consolidated revenue reached 909.0 billion won, operating profit 75.3 billion won, and owners' net income 56.6 billion won, with operating margin improving for four straight years.
3
In Q2 2026, strong trading and retail results drove operating profit and net income up more than 40% year over year.
4
Exposure to JoongAng Group entities (JTBC, JoongAng Ilbo) is about 84 billion won, roughly 13% of equity, and the Financial Supervisory Service is inspecting the related bond underwriting process.
5
The company is simultaneously pursuing an OTC derivatives license and a capital increase subscribed by its largest shareholder.

Business structure

Hanyang Securities operates four business lines: proprietary trading, investment banking (including real estate project financing and bond/DCM underwriting), brokerage, and other businesses such as fund distribution.

Its profit mix is concentrated, with proprietary trading contributing 68.4% and investment banking 52.4% of 2025 operating profit, while brokerage (-0.8%) and other businesses (-20%) posted losses.

In Q1 2026, proprietary trading (55.74%) and investment banking (43.19%) again drove profits, while brokerage (-6.43%) and other businesses (-5.36%) remained weak.

In June 2025, KCGI's second private equity fund acquired a 29.59% stake from the Hanyang University foundation and related parties for about 220.4 billion won at 58,500 won per share to become the largest shareholder, and the Financial Services Commission approved the change on condition that KCGI manage the company responsibly for at least five years and that key investor OK Financial Group give up its right of first refusal.

Since then, the company has pursued a strategy of shifting away from real estate project-financing-centered revenue toward capital-markets businesses such as OTC derivatives, investment banking, and bonds.

To that end, it approved a 50 billion won third-party capital increase to its largest shareholder in June, with proceeds earmarked for capital required to obtain an OTC derivatives license and to strengthen investment banking, bond, and retail competitiveness.

In retail, the firm is introducing a Financial Manager system, upgrading its mobile trading system, and diversifying products with special repo offerings and target-date funds to lift its historically weak brokerage franchise.

The trading business is expanding into ETF liquidity-provider services, securities lending intermediation, and margin financing to grow higher-turnover, capital-efficient activities.

Through this restructuring, the company has stated a goal of reaching 1 trillion won in equity capital and 100 billion won in net income by 2030.

Earnings trend

Quarterly revenue · Operating profit

25Q2₩205.9B₩18.9B25Q3₩256.4B₩9.3B25Q4₩511.3B₩26B26Q1₩813B₩25.5B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩1.1T₩37.2B2022₩999B₩46.3B2023₩833.3B₩54.4B2024₩909B₩75.3B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	—	—	—
2025Q3	₩205.9B	₩18.9B	9.2%
2025Q4	₩256.4B	₩9.3B	3.6%
2026Q1	₩511.3B	₩26B	5.1%
2026Q2	₩813B	₩25.5B	3.1%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩1.1T	₩37.2B	₩24B	3.3%	5.2%	227.2%
2023	₩999B	₩46.3B	₩35.1B	4.6%	7.2%	256.8%
2024	₩833.3B	₩54.4B	₩38.8B	6.5%	7.5%	236.7%
2025	₩909B	₩75.3B	₩56.6B	8.3%	9.7%	215.2%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

Annual revenue fell from 1,117.1 billion won in 2022 to 999.0 billion won in 2023 and 833.3 billion won in 2024 before recovering to 909.0 billion won in 2025, while operating profit rose for four consecutive years, from 37.2 billion won to 46.3 billion won, 54.4 billion won, and 75.3 billion won.

As a result, operating margin steadily improved from 3.3% in 2022 to 4.6% in 2023, 6.5% in 2024, and 8.3% in 2025.

Owners' net income also expanded regardless of revenue swings, moving from 24.0 billion won (2022) to 35.1 billion won (2023, up 46.2%), 38.8 billion won (2024, up 10.5%), and 56.6 billion won (2025, up 45.9%).

Operating cash flow, which was negative at -0.15 billion won in 2022 and -132.6 billion won in 2023, turned positive at 106.4 billion won in 2024 and expanded further to 260.4 billion won in 2025, marking a significant improvement in cash-generating capacity.

On a quarterly basis, revenue was 205.9 billion won with operating profit of 18.9 billion won and owners' net income of 14.3 billion won in Q3 2025, but profit slowed sharply in Q4 2025 even as revenue rose to 256.4 billion won, with operating profit at 9.3 billion won and net income at 7.6 billion won.

Entering 2026, revenue jumped to 511.3 billion won in Q1 (operating profit 26.0 billion won, net income 18.6 billion won) and 813.0 billion won in Q2 (operating profit 25.5 billion won, net income 19.7 billion won), a surge largely attributable to expanded high-turnover activities such as trading and ETF liquidity provision being reflected in revenue accounts, with operating profit and net income growing more modestly than revenue.

Q2 2026 operating profit and net income rose 43.3% and 44.5% year over year respectively, and first-half cumulative figures also grew 9.1% and 10.4%.

The company attributed the improvement to strong equity markets and expanded ETF liquidity-provider activity in trading, along with higher brokerage commission and margin-lending interest income in retail.

Industry analysis

The domestic securities industry has enjoyed a favorable environment in 2026, with rising trading volumes and a strong equity market helping large brokers such as Mirae Asset Securities and Korea Investment & Securities post record quarterly profits.

In contrast, real estate project financing (PF) has remained in a prolonged downturn since the high-rate period, prompting small and mid-sized brokerages to trim related staff and diversify their businesses.

The bond and debt capital markets (DCM) segment has faced an unfavorable environment of rising market rates and reduced institutional trading, with bond valuation losses cited industry-wide as a key risk to Q2 earnings.

Amid this, the growing ETF market has emerged as a new revenue source through liquidity-provider business.

Hanyang Securities is a small to mid-sized broker ranked in the high-20s by equity capital, maintaining traditional strengths in real estate PF and bonds while expanding into trading, retail, and ETF liquidity provision to build a turnover-focused earnings model distinct from larger peers.

However, with JoongAng Group affiliates such as JTBC and JoongAng Ilbo entering rehabilitation proceedings, about 67% of the securities industry's total exposure of 125.1 billion won — roughly 84 billion won — is concentrated at Hanyang Securities, making it the most prominent individual risk case in the sector.

Credit rating agencies have generally assessed the company's asset quality and capital adequacy positively while flagging the pace of exposure recovery and collateral value changes as key factors to watch.

Outlook

The company is targeting obtaining an OTC derivatives license by year-end, and given the typical roughly three-month review period, an outcome may become clear within the fourth quarter.

To support this, it approved a 50 billion won third-party capital increase to its largest shareholder in June, with proceeds earmarked for capital strengthening and bolstering investment banking, bond, and retail competitiveness.

As of the end of March 2026, its net capital ratio (NCR) stood at 631.8%, well above the regulatory guideline of 100%, suggesting sufficient capital capacity to support new business expansion.

Regarding the 84 billion won JoongAng Group-related exposure, the company has laid out a plan to recover about 87% (73.1 billion won) by year-end and the remainder by February 2027, though this is contingent on collateral values and recovery timelines proceeding as planned.

In terms of business structure, the shift from traditional trading, DCM, and bond-centered activities toward higher-turnover businesses such as ETF liquidity provision, securities lending intermediation, and margin financing is expected to continue.

In retail, expansion of the customer base through mobile trading system upgrades and special product offerings is likely to continue.

On shareholder returns, the company has set out a value-up policy of maintaining either a minimum dividend or a payout ratio of at least 30%, along with a shareholder return ratio of at least 30%, for 2025-2027.

However, the outcome of the FSS's on-site inspection into the JTBC bond underwriting process and the progress of JoongAng Group's rehabilitation proceedings remain variables that could affect future earnings and capital ratios.

Valuation

PER

4.2×

PBR

0.4×

ROE

9.9%

EPS

₩4,656

BPS

₩51,868

Dividend per share

₩1,600

Hanyang Securities' shares tend to trade at a discount to net asset value, with the price-to-book ratio sitting below 1x.

The steady earnings recovery from a period of weaker profitability in recent years forms part of the valuation discussion, though many view this as the combined result of business diversification and an improved market environment.

On dividends, the company has stated through its value-up disclosure that it will maintain a payout ratio at or above a certain level (37.4% on a consolidated basis in the most recent year) along with a minimum dividend policy, an attempt to make shareholder returns more predictable.

However, with JoongAng Group-related exposure and a regulatory inspection drawing attention, the market appears to be watching both the durability of the earnings recovery and the company's risk-management capability. Views on valuation may differ across investors, and this report does not offer a directional judgment.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

Bull factors

Broader earnings base through diversification

Expanded ETF liquidity-provider activity in trading and higher brokerage commission and margin-lending interest income in retail underpinned earnings improvement in H1 2026.

The company is shifting its center of gravity from bonds, DCM, and real estate PF toward higher-turnover businesses such as securities lending intermediation and margin financing, an attempt to reduce dependence on any single segment. Operating margin has also improved for four straight years, from 3.3% in 2022 to 8.3% in 2025.

Capital reinforcement and solid regulatory capital ratio

Largest shareholder KCGI PEF participated in a 50 billion won capital increase, signaling committed ownership, and the new shares were issued at a premium to the market price, reducing dilution pressure on existing shareholders.

As of end-March 2026, the net capital ratio (NCR) stood at 631.8%, well above the 100% regulatory threshold, suggesting sufficient capital capacity for new business expansion.

KCGI submitted documentation to regulators committing to responsible management for at least five years, providing a basis for long-term management stability.

New revenue streams from business expansion

The company is pursuing an OTC derivatives license with a year-end target, a business viewed as a potential new mid-to-long-term revenue source. In retail, product diversification continues through a Financial Manager system, mobile trading system overhaul, and special repo and target-date fund offerings.

If this restructuring bears fruit, the earnings structure that has been driven by a few segments could become more balanced.

Bear factors

JoongAng Group exposure and regulatory inspection

Exposure to JoongAng Group entities (JTBC, JoongAng Ilbo) of about 84 billion won represents roughly 13% of equity and accounts for a large share of the securities industry's total exposure.

The company emphasizes recovery prospects through collateral structures, but the timing and amount of recovery could diverge from plan depending on how rehabilitation proceedings unfold.

The Financial Supervisory Service has launched an on-site inspection into the JTBC bond underwriting process, examining risk review and investor disclosure obligations.

Structural burden in bonds and real estate PF

The bond and DCM segment faces an unfavorable environment of rising rates and reduced institutional trading, with bond valuation losses cited industry-wide as an earnings risk factor.

Real estate PF has been in a prolonged downturn since the high-rate period, prompting a shift toward more conservative refinancing of quality projects. Focusing on structured deals that minimize capital deployment in this process could constrain the pace of growth.

Uncertainty from ownership transition

Since KCGI became the largest shareholder in June 2025, governance-related disputes have surfaced, including minority shareholders filing an injunction against new share issuance during a capital increase.

Concerns also persist that, with a private equity firm as the controlling shareholder, the direction and pace of business restructuring could diverge from existing shareholders' expectations.

The liquidity ratio declined from 142.6% at the end of 2024 to 138.2% at the end of 2025, which could increase the burden of managing reliance on short-term market funding.

Risk factors

Credit/counterparty risk

The rehabilitation proceedings of JoongAng Group affiliates could create uncertainty around the timing and extent of recovery of related receivables.

While the existence of collateral partially supports recoverability, changes in asset values or the effectiveness of the trust structure could require additional loss recognition. Whether related provisions are reflected in upcoming quarterly results is a key point to monitor.

Regulatory/supervisory risk

The Financial Supervisory Service is conducting an on-site inspection of Hanyang Securities related to the JTBC bond underwriting process, and confirmed violations of investor protection obligations could lead to sanctions.

The FSS previously issued an institutional warning and a fine for improper use of non-public information and violation of concurrent office-holding rules. Regulators' assessment of internal control systems during the review of the new OTC derivatives license could also affect the timing of approval.

Liquidity/funding risk

The company's liquidity ratio declined from 142.6% at the end of 2024 to 138.2% at the end of 2025, and it relies relatively heavily on short-term market funding such as commercial paper and short-term bonds.

If concerns about creditworthiness intensify due to the JoongAng Group issue, refinancing terms could deteriorate. The company has stated it is managing liquidity by reducing market-based borrowing by about 400 billion won.

What to watch next

Mid-November 2026
Expected Q3 earnings release (tentative timing) — worth checking whether trading and retail continue to drive profit and whether any JoongAng Group-related provisions are recognized.
End of December 2026
Whether the OTC derivatives license is obtained — worth confirming whether the year-end target the company has set is actually met.
End of December 2026
Whether the target of recovering 87% (about 73.1 billion won) of JoongAng Group-related exposure is met — a point to check on the actual progress of the company's recovery plan.
February 2027
Deadline for full recovery of remaining JoongAng Group-related exposure — whether recovery is completed as planned will determine whether the related risk is resolved.
Timing to be confirmed
Release of the FSS's findings from its on-site inspection of the JTBC bond underwriting process — the conclusion on investor protection compliance could affect future sanctions and market confidence.

Overall view

From 2025 through the first half of 2026, Hanyang Securities has shown improving operating margins and rising net income as its trading- and retail-centered business restructuring is reflected in results.

At the same time, since KCGI became the largest shareholder in June 2025, the company has pursued expansion into OTC derivatives and capital reinforcement while setting a mid-to-long-term goal of 1 trillion won in equity capital.

However, the 84 billion won exposure related to JoongAng Group (JTBC, JoongAng Ilbo) and the associated FSS on-site inspection have emerged as a new variable testing its risk-management capability.

The bond/DCM and real estate PF segments have taken relatively defensive approaches amid rising rates and a prolonged downturn, and the decline in the liquidity ratio is another indicator worth watching.

Credit rating agencies have generally assessed the company's asset quality and capital adequacy positively while identifying the pace of exposure recovery as a key factor to monitor.

Overall, this appears to be a period where positive earnings recovery and business diversification coexist with uncertainty from JoongAng Group-related risk and ownership transition.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.