Japan & South Korea Telco Investor Tour

JAPAN: In what appears to be a meaningful positive change in the market, SoftBank is becoming less focused on customer share and more focused on revenue share instead. KDDI should have released its new Mid-term strategy too. This makes a trip to understand tactics and strategies of the various operators highly worthwhile in our view. On this trip we will be meeting all 3 incumbents plus Rakuten to better understand market dynamics, as well as taking time to hear from those at the sharp end selling the telco’s plans in stores. We continue to see Softbank as the winner through its powerful consumer ecosystem and NTT the loser. The trip comes right after the release of March year end results and guidance so investors in this space are highly encouraged to join us.

SOUTH KOREA: 2025 was a tricky year for Korean telcos with all 3 suffering data breaches. However, beneath the surface the sector is delivering on “Value-up” strategies. Headcount and selling expenses are falling, and so is core telco capex. As a result, EFCF is growing relatively rapidly. SKT chose to skip its dividend, but the underlying trend of shareholder remuneration also seems positive, with KT and LG U-Plus both raising dividends (KT by 20%). With regards to the asset side of the balance sheet there was also action. KT has sold a major real estate development, while SKT’s stake in Anthropic is worth around 13% of its market cap at the rumoured IPO price. We see nothing in the near term to derail this picture of improving trends, while valuations continue to look very cheap. We remain bullish on all three therefore, though KT is our top pick.

The tentative schedule as it currently stands is as follows. If there is specific interest in other countries (Thailand, Singapore, Indonesia) these could be added on request.

Friday, 15th May: Seoul, South Korea

Monday, 18th May: Tokyo, Japan

Tuesday, 19th May: Tokyo, Japan   

If you are interested in joining us on the tour, please reach out to me directly at chris@newstreetresearch.com or your NSR Sales representative.