The “foreign equity limit” (49%) has hampered KT’s stock price. As of the end of 2025, this limit is..
The “foreign equity limit” (49%) has hampered KT’s stock price. As of the end of 2025, this limit is full. Shareholder returns include dividends and treasury stocks, and KT is virtually impossible to incinerate its own shares. If it is incinerated, the foreign ownership ratio will exceed 49%, which will violate the law.
KT, which brought in a new CEO last year, decided to devote all its efforts to burning its own shares to dividends. Just in time, 2026 is a year to give “separate taxation” benefits to investors of high-dividend listed stocks like KT. When separate taxation is applied, investors have a greater tax burden than in the past. This is why KT is expected to attract “big hands” such as institutional investors in the new year.
KT sells ‘bundle products’ such as AI, big data, and security
KT is a telecommunications company like SK Telecom and LG Uplus. It is a structure in which network services such as mobile phones, the Internet, and wired phones are provided to individuals to accumulate stable income and distribute some of them. It sells artificial intelligence (AI) and cloud, big data, and media solutions to companies. The business structure is solid enough to continue dividends.
I also have a real estate business here. It conducts office, residential, and hotel development projects through the group company ‘KT Estate’. When the domestic real estate business was booming, it made a good profit. KT reduced its existing business, focused its capabilities on AI, and reduced costs by restructuring its business until last year.
KT was analyzed based on Investing.COM and FnGuide to see how close the company is to AI. KT has the largest market capitalization among companies that are listed on the KOSPI and have a high AI connection, and have a dividend growth rate of more than 10% over the past five years and a dividend yield of more than 3%.
There are three main reasons why KT is grouped into AI-related stocks. First of all, this carrier is a company that has a way to turn AI. It operates with infrastructure such as communication networks, dedicated lines, and data centers. As AI traffic increases, KT naturally becomes a beneficiary.
It also sells ‘AI+Cloud (AX)’ so that companies can use AI. It provides corporate customers with bundled solutions such as cloud, AI, big data, and security, and has become a steady revenue for IT companies. It aims for greater profits by creating its own AI platform and joining hands with external big tech. A typical example is ‘Mi:dm’.
KT’s dividend growth rate is 16%…I’m not envious of U.S. dividend stocks
KT’s dividend growth rate is as good as any other dividend growth stock in the U.S. The annual dividend increased from 1,100 won in 2020 to 2,300 won in 2025. Based on the annual average composite growth rate (CAGR), it reaches 15.9%. Usually, if it exceeds 10%, it is said that dividend growth is excellent, but KT far exceeds this standard.
When analyzing dividend stocks, the “total return” is calculated by combining the dividend yield with the stock price increase rate. The dividend yield at the end of 2025 is 3.9%. Last year’s annual stock price increase was 15.3%. After all, the total return is 19.2%. KT’s yield may be a bit disappointing as the KOSPI rose 76%.
However, KT is showing off its excellent dividend growth rate while expanding its AI business with its counterpart. If you owned KT five years ago, you will receive an annual dividend of 2,300 won with a stock price of 44,500 won. If you look at this as a dividend yield, it is 5.2%. The real dividend rate rises when held for a long time.
KT is a high dividend listed corporation. People who invest in these listed corporations will receive separate taxation benefits starting this year, greatly reducing their tax burden. This is why many investors are flocking to high-dividend listed stocks with such a stable business structure this year in terms of portfolio adjustment.
The requirement for a high-dividend listed company should be a place where the dividend payout ratio is more than 40% or the dividend payout ratio exceeds 25%, while at the same time increasing the dividend by more than 10% compared to the previous year. Here, the dividend payout ratio is the total amount of dividends divided by net profit, which means the willingness of listed companies to pay dividends. KT easily meets the first requirement with a dividend payout ratio of more than 58%.
Wall Street “KT’s stock price gains 27% in New Year”
KT, SK Telecom, and LG Uplus are competing against each other. Even among investors, they often compare them well. Compared to the expected net profit ratio (PER) for the next year, KT is the middleman. SK Telecom is the most expensive at 9.78 times PER, and KT is 8.78 times higher. LG U+ has the lowest stock price compared to its performance at 8 times.
A single digit PER usually means a low investment risk. Wall Street also sees room for KT’s stock price to rise a lot in the new year. According to Bloomberg, KT’s average target stock price of 21 domestic and foreign investment banks is 26.8% higher than that of the end of 2025. They say there is room for a rise this year.
On the basis of net profit, which involves a large number of one-time costs, KT’s performance seems to have risen sharply in 2025 and gradually returned to normal this year and next year. In April last year, a hacking incident against SK Telecom caused a large number of personal information to be leaked. Surprised customers were transferred to KT or LG U+. In June 2025, more than 80,000 telecommunications companies were changed to KT for a month.
Another temporary effect following the surge in wireless subscribers is the profits from the sale of real estate such as Lotte Eastfall. KT’s real estate business performance was once spotlighted as a “thank you” business, but it is difficult to expect a boom like last year, considering the atmosphere of the real estate sales business that has died this year.
KT’s net profit, which is also a source of dividends, is in the shape of a “mountain” from 417.1 billion won in 2024 to 1.867.2 trillion won in 2025 and 1.583 trillion won this year (expected). Usually, such a decrease in net profits makes it difficult to raise dividends, but KT is expected to focus on dividends instead of burning treasury stocks, so dividend growth of more than 10% is expected to be maintained for the time being.
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