Chan Lee And Albert Yong: Korean Equity Ideas

Chan Lee And Albert Yong: Korean Equity Ideas

Chan Lee is the Co-Founder and a Managing Partner of Petra Capital Management. Since inception in September 2009, its Petra Korean Value Equity strategy has earned an annualized return of 24.9%, significantly outperforming the Korean index (i.e., KOSPI) which has returned 4.7% annualized during the same period.

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Albert Yong is the Co-Founder and a Managing Partner of Petra Capital Management. Petra Korean Value Equity strategy has substantially outperformed the Korean market as its portfolio is up 159.9% since its inception in September 2009, compared with 21.6% increase by the Korean index (i.e., KOSPI).

Chan Lee And Albert spoke at the 9th Annual Value Investing Congress, also see Shiller’s CAPE Ratio Applied To South Korean Stocks. Below are notes from their presentation.

Highlights from Chan Lee And Albert Yong’s presentation

Returned 24.4% CAGR vs 4% KOSPI Composite Index (INDEXKRX:KOSPI) since Sept 2009

Idea: Nexen Tire Corp (KRX:002350)

Market cap: 1,300B won

Sales: 1700B won

Ebit: 177b eon

Yield 0.4%

Pe 9.9x

Price to book: 1.5x

Stock down as growth stalled

Established in 1958

Auto tire manufactures

Low cost

20- percent sales cagr since 2007

Global sales American, Korea, Europe

3 factories now. Opening one in Czech Republic

To buy it cheaper, buy preferred shares. They are 60% cheaper. No voting rights but same economic rights

5830 won vs 13950 won for common

4x PE

3rd way to own a stake: buy holding company stock

Nexen Corporation (KRX:005720) owns 41% of Nexen Tire Corp (KRX:002350). And it makes up 70% of holding company value. 6.4x PE and 0.7x price to book.

Chan Lee Albert Yong Search of Hidden Champions in South Korea by scribdvw

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