LG tops in market cap gain, beating Samsung, SK, Hyundai Motor

The total market value of companies under South Korea’s fourth-largest business group LG increased the most in a year, beating out its bigger rivals Samsung, SK and Hyundai Motor, under Chairman Koo Kwang-mo’s leadership to drive innovation with new growth engines.  

The combined market cap of LG Group companies jumped 17.4% to 246.2 trillion won ($186.3 billion) from March 31, 2022 to March 31, 2023, according to a Korea Economic Daily analysis of the market value, as of April 9, of 59 listed firms under Korea’s big-four business groups by assets — Samsung Group, SK Group, Hyundai Motor Group and LG Group.

Over the same period, the biggest group Samsung companies' total market value shed 4.8%, and runner-up SK shrank 26.9%. Hyundai Motor’s value was down 0.3%.

LG Group’s ascent is largely attributed to Chairman Koo’s efforts to reform the group’s business portfolio with a focus on new growth engines such as secondary batteries and auto parts, while ditching money-losing businesses such as smartphone and photovoltaic businesses since he took the reins in June 2018.

Last month, Koo declared AI, bio and clean tech as LG’s new growth drivers that should lead the group’s growth over the next 10 to 15 years.

BATTERY, AUTO COMPONENTS LEAD

LG Group’s secondary battery maker LG Energy Solution Ltd.’s market value increased the most over the cited period, from 103.4 trillion won to 136.7 trillion won, thanks to the global auto industry’s rapid transition to electrification.

The surge in EV battery demand has also lifted the market cap of LG Chem Ltd., LG Energy Solution's parent company, which supplies materials to its battery subsidiary.

Auto components have grown into a mainstay business at LG Group. The vehicle electronics division of LG Electronics Inc. is projected to report an operating profit in the first quarter of this year after it swung to a profit of 169.7 billion won for the first time last year.

The total orders backlog of LG’s automotive electronics and components affiliates, including LG Magna e-Powertrain Co. and LG Innotek Co., is estimated at 100 trillion won in value.  

Total sales of LG Group's listed firms are hovering in the 200 trillion won level after leaping to 190.3 trillion won in 2022 from 175.6 trillion won in 2021 and 139.2 trillion won in 2020.

Write to Jeong-Soo Hwang at hjs@hankyung.com
Sookyung Seo edited this article.