CJ Group affiliates suffer 20% drop in market value this year
Rachel Ahn, Nov. 4, 2016, 9:38 a.m.
Nine affiliates of the CJ Group, a South Korean food and entertainment conglomerate, have suffered about a 20 percent drop in their total market value so far this year, hit by sluggish consumption and external risks, a survey showed Friday.
According to the survey by industry tracker FnGuide, the total market value of the nine CJ affiliates fell 20.14 percent, or 5.1 trillion won ($4.4 billion), to 20.5 trillion won as of Thursday, compared with 25.7 trillion won at the end of last year.
It was the worst performer among 15 business conglomerates, FnGuide said.
Besides weak domestic consumption, shares of CJ affiliates have been under duress due to concerns that a deployment of the advanced U.S. missile defense system, or THAAD, might have a negative impact on their businesses in China.
Investors have also feared that an influence-peddling scandal involving Choi Soon-sil, a long-time friend of President Park Geun-hye, may deal a blow to shares of CJ stocks amid speculation that CJ might have been involved in culture-related businesses that were believed to be led by Choi.
CJ officials denied the speculation.
CJ Freshway, a food distribution and catering affiliate, saw its market value plunge 53 percent.
The market value of CJ CGV, a multiplex cinema chain with business interests in China, sank about 47 percent, according to FnGuide.
Yoon Tae-ho, an analyst at Korea Investment & Securities, advised investors to take a cautious approach to CJ stocks until uncertainty over the political scandal is removed. (Yonhap)