Company Overview

Mirae Asset Securities is the flagship subsidiary of Mirae Asset Group, South Korea's largest asset-management conglomerate, and holds the top position in the domestic brokerage industry by equity capital. Its ascent to industry leadership was cemented in 2016 through the acquisition and merger of Daewoo Securities, creating a capital base that qualifies it as a so-called "mega-IB" — a designation used by South Korean regulators for investment banks with equity exceeding 4 trillion won. The firm operates across retail brokerage, wealth management, investment banking, trading, and overseas subsidiaries, and maintains the most extensive international network of any Korean securities house.

Yet for years, Mirae Asset Securities has been cited as a textbook case of chronic undervaluation in the Korean market. Despite a return on equity (ROE) that has at times exceeded 10%, its price-to-book ratio (PBR) has persistently languished in the range of 0.4 to 0.6 times. Investors have repeatedly criticised the firm's low dividend pay-out ratio and its apparent reluctance to cancel treasury shares. This structural discount moved to the centre of public debate in late 2023, when the South Korean government launched its "Corporate Value-Up Programme" — a policy initiative aimed at closing the so-called Korea Discount, the persistent gap between Korean equities' valuations and those of comparable firms elsewhere. The gulf between Mirae Asset Securities' standing as the country's largest broker and its underwhelming shareholder returns became the defining tension of its value-up story.

Business Foundations and Financial Performance

*Post-merger growth and revenue diversification*

The 2016 merger with Daewoo Securities elevated Mirae Asset Securities' equity capital to roughly 8 trillion won, laying the groundwork for mega-IB status. In the years that followed, the firm pursued revenue diversification through overseas expansion, real-estate project finance, alternative investments, and growth in wealth management. The surge in retail investors following the COVID-19 pandemic in 2020–21 provided a further tailwind, and in 2021 the firm recorded its highest-ever annual operating profit, surpassing 1 trillion won for the first time.

*Market headwinds in 2022–23*

The cycle turned sharply in 2022 as interest-rate rises and a downturn in property markets weighed on the entire brokerage industry. Mirae Asset Securities was particularly exposed to concerns about impaired alternative-investment assets and redemption pressures on its overseas real-estate funds, dragging both earnings and its share price lower. Conditions stabilised somewhat in 2023, but provisioning related to overseas real-estate exposures continued to weigh on results.

*Annual financial summary*

Year | Operating Profit (bn won) | Net Profit (bn won) | Equity Capital (tn won) | ROE (%) | DPS (won)

2019 | 582 | 431 | ~9.5 | 4.9 | 200

2020 | 764 | 589 | ~10.1 | 6.1 | 250

2021 | 1,035 | 812 | ~10.8 | 7.8 | 300

2022 | 521 | 374 | ~11.0 | 3.5 | 200

2023 | 748 | 523 | ~11.3 | 4.8 | 250

2024 | ~810 (est.) | ~590 (est.) | ~11.5 | ~5.2 (est.) | 300 (forecast)

*Figures are on a consolidated basis; some are estimates and may differ from final disclosed results.*

Value-Up Milestones

*January 2016 — Daewoo Securities merger: building the mega-IB platform*

The completion of the Daewoo Securities acquisition in January 2016 created the largest equity capital base in the Korean brokerage industry and provided the foundation for mega-IB regulatory approval. Even so, the share price remained weak in the years that followed. Low ROE relative to a large equity base became a persistent drag on the valuation multiple.

*December 2018 — First treasury-share buyback: a cautious gesture*

In late 2018, the board approved a plan to buy back treasury shares — a move that coincided with a period of falling share prices. However, because the purchased shares were held rather than cancelled, the effective benefit to shareholders was limited. This episode established the pattern of buybacks without cancellations that would draw sustained criticism in subsequent years.

*March 2021 — Short-term finance licence: business expansion takes priority*

In 2021 the firm received regulatory approval to issue short-term promissory notes (a privilege restricted to mega-IBs under Korean law), expanding its funding toolkit and reinforcing its competitive position in investment banking and alternative assets. Some investors, however, voiced concern that the emphasis on business growth meant capital was being directed away from shareholder returns.

*November 2023 — Korea Value-Up Programme announced: expectations begin to build*

When South Korea's Financial Services Commission formally unveiled the Corporate Value-Up Programme in November 2023, sentiment around Korean brokerage stocks improved markedly. With a PBR of roughly 0.4 times, Mirae Asset Securities was widely identified as one of the programme's most obvious potential beneficiaries. Institutional investors began pressing the firm more openly for enhanced shareholder returns around this time.

*February 2024 — Share price rebounds on policy detail*

As further details of the value-up programme were released in February 2024, Mirae Asset Securities' share price staged a meaningful short-term rally. Markets interpreted the move as pricing in the prospect of higher dividends and share cancellations. Mirae Asset Group was also reported to have begun reviewing group-level measures to enhance shareholder value.

*June 2024 — Value-up disclosure: quantitative targets set*

In June 2024 the company published a formal value-up disclosure committing to a medium-term total shareholder return (TSR) ratio of at least 30%, to be achieved through a combination of dividends and treasury-share buybacks and cancellations. The firm also set a medium-to-long-term ROE target of 10% or above.

*November 2024 — Treasury-share cancellation: a symbolic turning point*

In November 2024, the board resolved to cancel a portion of the treasury shares it had accumulated over the years. The scale of the cancellation was modest relative to total shares outstanding, but the decision was widely seen as a meaningful change in direction — the firm's first genuine step away from the passive, accumulate-and-hold approach that had long frustrated shareholders.

Challenges and Assessment

*Remaining obstacles*

Several structural challenges must be addressed if Mirae Asset Securities is to deliver on its value-up commitments.

The most pressing is the resolution of overseas real-estate exposures. The firm is understood to carry the largest such exposure of any Korean securities house, including direct and indirect stakes in commercial office buildings in the United States and Europe. With those markets still under pressure, the risk of further provisions remains, creating uncertainty around the earnings base from which dividends and buybacks are funded.

Governance concentration is a related concern. Under the stewardship of founder and chairman Park Hyun-joo, strategic priorities at the group level may not always align with the interests of minority shareholders in the listed entity. ESG rating agencies have persistently flagged the need for greater board independence and stronger minority-shareholder protections at the firm.

Capital efficiency is the third major challenge. With equity capital exceeding 11 trillion won, an ROE of 5–8% implies a significant misallocation of resources. The firm's issuance of short-term promissory notes provides some additional leverage, but a more concrete strategy for deploying its large capital base productively has yet to be articulated.

*Overall assessment*

Mirae Asset Securities has been a late mover in Korea's shareholder-return debate, but its direction of travel is now correct. The 2024 treasury-share cancellation and the formal TSR target represent a genuine break from years of inertia.

That said, critics argue that the targets remain conservative by international standards. Nomura and Daiwa, Japan's two largest brokerages, routinely return more than 50% of earnings to shareholders; a 30% TSR target looks modest even by Asian brokerage norms. Questions also persist about the credibility of the ROE roadmap: without a clear path to 10% returns, the sustainability of the shareholder-return programme is open to doubt.

Nevertheless, the Corporate Value-Up Programme has given Mirae Asset Securities a public platform and a degree of external accountability. Its formal embrace of shareholder-return discipline, however belated, is likely to be recorded as a meaningful inflection point in the firm's history.

Controversies and Structural Constraints

*Treasury-share opacity: a long-standing criticism*

For years, Mirae Asset Securities bought back its own shares without cancelling them — a practice widely criticised in Korea. Held treasury shares carry no voting rights, leaving the controlling shareholder unaffected, while the overhang of potential resale supply depressed the share price. Critics argued the buybacks served as a share-price management tool or a corporate-governance defence mechanism rather than a genuine return of capital to investors.

*Overseas real-estate losses: a persistent source of uncertainty*

The firm's exposure to overseas commercial property — notably office buildings in New York — has generated repeated provisioning charges in 2022 and 2023. So long as this exposure remains on the books, it constrains both the dividend-paying capacity and the credibility of shareholder-return commitments.

*Founder-led governance: strengths and risks*

Chairman Park Hyun-joo's entrepreneurial drive has been the engine of Mirae Asset Group's remarkable growth, but his concentrated authority creates governance risks for outside shareholders. The practical independence of the board and the effectiveness of non-executive directors in challenging management decisions are questions that ESG analysts have raised consistently, and they remain a constraint on institutional investor confidence.

*Overseas subsidiaries: opacity and capital drag*

Mirae Asset Securities operates subsidiaries across the United States, the United Kingdom, Hong Kong, India, Brazil, and other markets. Detailed profit-and-loss information for individual overseas units is not fully disclosed, and ongoing capital injections into international operations may structurally limit the shareholder returns available to investors in the South Korean listed entity.

Key Metrics Summary

Year | DPS (won) | Pay-out Ratio (%) | Buybacks (bn won) | Cancellations | Operating Profit (bn won) | PBR (x) | TSR Ratio (%)

2019 | 200 | ~18 | ~50 | None | 582 | 0.42 | ~20

2020 | 250 | ~17 | ~80 | None | 764 | 0.48 | ~22

2021 | 300 | ~15 | ~100 | None | 1,035 | 0.52 | ~20

2022 | 200 | ~22 | ~50 | None | 521 | 0.38 | ~24

2023 | 250 | ~19 | ~70 | None | 748 | 0.44 | ~23

2024 | 300 (fcst) | ~22 (est.) | ~120 (est.) | Partial cancellation resolved | ~810 (est.) | ~0.50 (est.) | ~28 (target)

*PBR figures are year-end estimates. TSR ratio combines dividends with buybacks and cancellations. Some figures are pre-disclosure estimates and may differ from final results.*