Foreign Investors Rediscover Telecom Stocks

Despite uncertainties across the domestic stock market, foreign investors are repurchasing shares of telecommunications-related companies (telecom stocks) due to their steady profit growth and attractive dividend yields. This is leading to foreign investment capital pouring into large-cap telecom stocks.

Since the beginning of April, foreign investors have net-purchased approximately 105 billion won worth of SK Telecom shares over eight trading days, exceeding March's net purchase volume of 94.4 billion won. This marks two consecutive months of net purchases following net selling in February.

LG Uplus also saw net purchases of 23.331 billion won since April, resuming buying activity after a three-month hiatus.

The increased interest in telecom stocks from foreign investors is attributed to expectations of improved performance and dividend appeal. SK Telecom is emerging as the sector's top pick, supported by the confirmation of its first-quarter earnings bottoming out and IBK Securities' forecast for a normalization of its dividend payout to 3,540 won per share.