Korea department stores: Priced like a trade, looking like a reset

研报英文原文证据摘录

Korea department stores: Priced like a trade, looking like a reset

J P M O R G A N Asia Pacific Equity Research

27 July 2026

Korea department stores

Priced like a trade, looking like a reset

Following our initiation on Korea department stores (link), investor feedback has Co-Head of Asia Pacific Consumer

converged on one concern: earnings look great, but isn’t this just a levered KOSPI/ Research and Head of Asia Gaming/

memory trade? If the KOSPI rolls over, the wealth effect fades; if memory stocks Leisure Research

fall, department stores de-rate faster. This framing misses the bigger picture, in our DS Kim AC

view, understating both the breadth and duration of the cycle. This is a three-engine (852) 2800-8597

trade: a lagged wealth effect still converting into consumption, structural inbound ds.kim@jpmorgan.com

J.P. Morgan Securities (Asia Pacific) Limited/ J.P.

growth, and a yet-to-come income effect as memory profits flow through to Morgan Broking (Hong Kong) Limited

bonuses. Together, these should support a multi-year earnings upcycle into 2027E Benjamin Kim AC

and beyond; yet these names trade at only 8.5x 2027E P/E after the recent (82-2) 758-5580

correction — below historical levels despite what we see as the sector’s first proper benjamin.kim@jpmorgan.com

earnings reset in over a decade. We stay bullish on the sector, with Shinsegae as our J.P.BranchMorgan Securities (Far East) Limited, Seoul

top pick, followed by Hyundai Department Store.

• “KOSPI giveth, KOSPI taketh away” argument misses the lag. Yes, the

recent correction matters, with the KOSPI down 26% from its June peak. But

even after that drawdown, we estimate YTD household wealth creation at

~W530T, still ~12% above last year’s entire gain. The bigger point is timing: