| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | n/a | n/a |
| Intrinsic value (DCF) | n/a | |
| Graham-Dodd Method | 6.80 | -69 |
| Graham Formula | 25.60 | 16 |
SK Telecom Co., Ltd. (SKT) is South Korea's leading telecommunications provider, offering a comprehensive suite of wireless and fixed-line services. Headquartered in Seoul, SKT operates across three key segments: Cellular Services, Fixed-Line Telecommunications, and Other Businesses. The company serves over 31.9 million wireless subscribers and 3.6 million fixed-line customers, leveraging advanced technologies like IoT, cloud computing, and metaverse platforms. SKT is a pioneer in 5G deployment and digital transformation, providing smart factory solutions, media platforms (IPTV, cable TV), and T-commerce services. With a strong focus on innovation, SKT also engages in quantum communications, e-book production, and digital content sourcing. As a dominant player in South Korea's telecom sector, SKT continues to drive connectivity and digital services, reinforcing its position in the global Communication Services industry.
SK Telecom presents a compelling investment case due to its market leadership in South Korea's telecom sector, strong cash flow generation (KRW 4.95 trillion operating cash flow in FY2023), and consistent profitability (KRW 1.08 trillion net income). The company benefits from a stable subscriber base and early-mover advantages in 5G and digital services. However, risks include high total debt (KRW 10.28 trillion) and capital expenditures (KRW 2.97 trillion), which may pressure margins. The stock's low beta (0.58) suggests defensive characteristics, but competition from KT Corp and LG Uplus could limit growth. Dividend investors may appreciate the KRW 0.56 per share payout, though yield-seeking investors should assess sustainability given capex demands.
SK Telecom maintains a dominant position in South Korea's telecom market, competing primarily with KT Corp and LG Uplus. Its competitive advantages include first-mover status in 5G deployment, a robust IoT and cloud services ecosystem, and vertical integration through subsidiaries like SK Broadband. The company's R&D focus on quantum communications and metaverse platforms differentiates it from peers. However, the South Korean telecom market is saturated, with intense price competition and regulatory pressures on service fees. SKT's scale provides cost advantages in infrastructure, but competitors match its network quality. The company's diversification into digital content and commerce (T-commerce) helps mitigate reliance on traditional telecom revenues. Its partnership with global tech firms enhances its technological edge, though this also exposes it to foreign competition in value-added services. SKT's main challenge is sustaining ARPU growth while investing in next-gen infrastructure.