Price Against Book

Figures converted from Korean won at historical FX rates — see data/company.json.fx_rates. Ratios, margins, and multiples are unitless and unchanged.

Price Against Book

Korea Asset In Trust's shares closed at $1.65 on 7 August 2026, valuing the equity at $202.0m against $764.8m of consolidated book value — 0.26 times book, on a book value per share that has risen 27% in won since December 2021 while the price fell 44%. This chapter converts that multiple into the two things it can arithmetically mean, tests both against the disclosed record and against the only listed peer, and prices what the wait pays.

Sources: close, market capitalisation and yield from the coverage record [1]; consolidated equity at 31 March 2026 from the Q1 FY2026 report [2]; implied loss derived from the two loan books at 31 March 2026 [3] [4].

Book value rose while the price halved

The share count has been effectively fixed for the whole period: 123,977,752 shares issued from 2021 through 2024, of which 1,603,826 were held in treasury and cancelled in March 2025, leaving 122,373,926 outstanding throughout [5]. Book value per share is therefore a clean series. Consolidated equity was $713.4m at the end of 2021 and $736.6m at the end of 2022 [6], $797.0m, $711.1m and $747.5m at the ends of 2023, 2024 and 2025 [7], and $764.8m at 31 March 2026 after the year-end dividend was struck [8].

The price series comes from the exchange data reprinted in each annual report. December closing prices ranged $3.39–3.64 in 2021 [9], $2.36–2.67 in 2022 [10], $2.43–2.55 in 2023 [11], $1.89–2.00 in 2024 [12] and $1.68–1.76 in 2025 [13].

Sources: December closing-price ranges from the annual reports [14] [15] [16] [17] [18], taken at the midpoint of the monthly high and low; book value per share derived from consolidated equity [19] [20] [21] over 122,373,926 shares [22].

Source: derived from the price and equity citations above.

The compression is continuous rather than a single re-rating event. Every year since 2021 the multiple has been lower than the year before, and in four of those five years reported book value per share was higher than the year before. The two figures that make up the ratio have moved in opposite directions for five consecutive years.

Two arithmetics behind one multiple

A 0.26 multiple can be arrived at from either end. Read as a statement about assets, it is a claim that the balance sheet carries more value than it will realise. Read as a statement about returns, it is the multiple a business earns when its sustainable return sits below its cost of capital, whatever the assets are worth.

The asset reading comes first. At 31 March 2026 the group held $525.0m of gross trust-account advances against a $132.7m allowance [23] — a 25.28% rate [24] — and $435.2m of loans at Korea Asset Capital against a $27.6m allowance, carried net at $405.9m [25]. That is $960.1m of gross property-development credit, $160.3m already provisioned (16.7%), $798.2m carried. The gap between the $764.8m of book value and the $202.0m of market value is $562.8m.

The balance that would take that loss carries a funding cost of its own. In FY2025 Korea Asset In Trust's trust-account loan book produced $35.5m of interest income and absorbed a $36.8m increase in its own allowance, while the group's interest expense for the year was $27.4m against $23.6m of operating income — a funding bill incurred on the $175.5m of borrowings the parent raised in 2024, the year the same advance book grew from $361.1m to $556.9m and parent cash fell to $1.6m. [26] [27] [28] [29] [30] [31] The funding record behind it sits in Funding the Advances.

If every other asset and liability is carried correctly, closing that gap out of the credit books alone takes a further 70.5% loss on what is left after existing provisions — a cumulative ultimate loss of $723.1m, or 75.3% of the gross book. Recognising tax relief on those provisions would make the required pre-tax loss larger still, not smaller.

Now the returns reading. On a zero-growth residual-income identity, price to book equals sustainable return on equity divided by cost of equity. At a 10% cost of equity, 0.26 times book corresponds to a permanent 2.6% return; at 12%, to 3.2%. The company's own disclosure puts consolidated return on average equity at 4.64% in 2025 [32], and its results deck runs the series back to 2021 for a five-year average of 9.4% [33]. Management's own adjusted measure, which strips the regulatory reserve movement out, averages roughly 5.4% over the same five years [34], as Provisions and Profit works through.

Source: derived from the disclosed return-on-equity series [35] [36] applied to book value per share of $6.25 at 31 March 2026 [37]; zero terminal growth assumed throughout.

The grid applies return assumptions with no forward-earnings anchor, and the fee line is where that anchor has to come from. Korea Asset In Trust's fee franchise contributed $63.8m of operating profit in FY2021 and $13.0m in FY2025, and the 2025 order vintage rebuilding it carried $41m of contracted borrowing-type fees against $1,299m of total project cost — 3.1% against 7.4% on the 2024 vintage, because redevelopment is priced at 2.5% of pre-sale proceeds against 3.5% conventional — while at 31 March 2026 the group's entire guarantee and completion-obligation book was four redevelopment sites with $126.5m of limits and $46.5m drawn. [38] [39] [40] [41] [42] On that intake, Redevelopment Pivot scales the fee line to roughly $44m a year through 2028, against $83m of consolidated fee income averaged over 2022 to 2024; whether the 5.4% row of the grid is reachable turns on that line rather than on the cost-of-equity assumption beside it.

The two readings are not alternatives to be chosen between; the discount is the product of both. But their sizes are very different. A 5.4% through-cycle return at a 10% cost of equity justifies roughly half the current discount on its own, with no asset-quality claim attached. What is left over — the move from about 0.54 times book to 0.26 — is the part that has to be an opinion about recovery on the loan books, and that residual still implies losses outside the observed record: $122.7m of provisions charged against $13.8m actually written off across FY2023–FY2025, as Provisions and Profit documents, and $44.9m of net recovery on the trust-account book in the March 2026 quarter [43].

On earnings the same shares are not expensive on any basis in the record.

Sources: reported net income by year from the FY2025 results deck [44]; the FY2026 estimate and the $202.0m market capitalisation from the coverage record [45].

The single broker still covering the stock published a $2.20 target on 30 September 2025 and has not refreshed it; the target is 12-month forward book value per share of $6.39 times 0.35, struck on an implied 5.1% return on equity [46]. That is a valuation built the same way as the middle row of the grid above, and it lands 33% above the current price.

The same discount at the only listed peer

The residual attributed above to Korea Asset In Trust's own loan books is not priced into this company alone. Korea Real Estate Investment and Trust — the only other listed pure-play Korean trust company, and the peer the Competition tab adjudicates as the sole like-for-like comparable — closed at $0.83 on 15 January 2026, the day it announced the disposal of 14,880,952 treasury shares. Its consolidated equity attributable to owners was $716.4m at the end of 2025 [47] on 252,489,230 shares issued [48] less 34,080,105 held in treasury [49]. That is $3.28 of book value per outstanding share, and 0.25 times book at that price — 0.27 once the disposed treasury shares are counted back in.

The comparison cuts against a purely company-specific reading of the discount, and it does so from the weaker side. Korea Real Estate Investment and Trust reported an operating loss of $14.4m on $127.2m of operating revenue in 2025, against Korea Asset In Trust's $23.6m of operating profit on $141.0m [50] [51]. Two firms with materially different 2025 income statements carry within two or three points of the same multiple of book. That pattern is more consistent with a sector-level de-rating of Korean trust-company balance sheets than with a market judgment about one company's loan tape — which also means a re-rating on this name is unlikely to arrive from company-specific evidence alone.

The peer price and the January 2026 treasury disposal are both single dated items from outside the filing corpus and are not verifiable in it; the equity, share and treasury figures behind the multiple are from the peer's own annual report.

A stress the disclosures can carry

The useful test of the asset reading is what the filings themselves would support if read against the company. Two adjustments can be made entirely from disclosed numbers.

Source: derived from the gross balances and allowances on both loan books at 31 March 2026 [52] [53] and consolidated equity [54]; no tax relief assumed.

Marking Korea Asset Capital's $435.2m at the parent's own 25.28% rate takes its allowance from $27.6m to $110.0m, the $82.4m harmonisation charge Where Book Value Sits derives. Lifting the trust-account allowance from 25.28% to 40% adds $77.2m. Together, $159.8m — 20.9% of book — leaving $605.1m of equity and $4.94 of book value per share. At $1.65 that is still 0.33 times a stressed book. A further 20% haircut on the $119.2m of level-3 fair-value holdings set out there would add about $24m and move the multiple to 0.35.

Eliminating the equity entirely from the current provisioning position requires $764.8m of further loss, which with existing allowances is a cumulative 96% loss on the whole $960.1m credit book. The group's borrowings were $412.9m against that equity and it held $109.2m of cash and deposits at 31 March 2026 [55], and the net operating capital ratio stood at 363.04% [56] against the 150% the investment-business regulation requires [57]. What a holder is underwriting here is a range of book values rather than a solvency question.

The debt market's version

The same balance sheet is rated, and the rating record is the closest thing to a third-party read on the loan books; the grades, the February 2025 placement and the maturity ladder behind them are set out in Funding the Advances. In April 2025 Korea Ratings and NICE both cut the outlook from stable to negative, citing operating profit falling from $116.0m in 2022 to $34.7m in 2024 [58].

On 2 May 2026 Korea Ratings cut the grade one notch to A- with a stable outlook, attributing the action to poor collection of trust-account advances and to interest and credit costs eroding recurring profitability. That action post-dates the last filing in this corpus — the Q1 FY2026 rating table still ends at 8 April 2025 — so it is sourced from the Korean financial press rather than from a filing, and it is reported here as such. Agencies that see the loan tapes have moved once, and the $88.3m of bonds falling due within a year of 31 December 2025 has to be refinanced at whatever the new grade prices [59].

What the wait pays

The dividend has been paid without a break since 2015, as History records. The FY2025 declaration was $0.10 per share, $12.7m in total, a 37.17% consolidated payout and a 5.7% yield on the reference price [60]. The five-year average disclosed yield is 5.6% [61]. On the 7 August 2026 close of $1.65 the same dividend is a 6.45% yield [62].

Source: dividend indicators table, FY2025 annual report [63].

Alongside it, the company cancelled 1,603,826 treasury shares on 26 March 2025 at a book value of $8.7m [64], 1.3% of the shares then issued, and describes the cancellation in its dividend policy as part of shareholder return [65]. That is the entire buyback record; no treasury holding remains beyond 6,871 fractional shares [66].

Part of that payment came out of paid-in capital rather than out of profit. Consolidated capital surplus fell from $89.0m at the end of 2024 to $48.9m at the end of 2025 and stood unchanged at $48.9m at 31 March 2026 [67] — the $41.4m of share premium moved into distributable retained earnings to fund the FY2025 dividend, which Provisions and Profit traces to the appropriation statement. At the FY2025 rate of $12.7m a year, what remains of that reservoir is close to four more payments if separate-basis profit never covers the dividend again. It is a real cushion and a finite one, and it converts paid-in capital into income rather than generating it.

The float

At 31 March 2026, 25,879 small shareholders held 53,729,807 shares, 43.91% of the 122,373,926 outstanding [68]; the rest sits with MDM, MDM Plus and Moon Ju-hyun, whose holdings the People tab shows have not changed in five years. At $1.65 that free float is worth $88.7m. Over the 80 sessions to 7 August 2026 the median day traded $0.39m of stock and the average day $0.65m [69].

Twice in the past year that float has behaved very differently. In February 2026 the stock traded 22,606,437 shares in the month, including 11,816,948 in one session, and ranged $1.78 to $2.09 [70] — 42% of the entire small-shareholder holding changing hands in four weeks, against a monthly norm nearer 3.6m shares. On 4 June 2026 the shares reached $2.02 intraday on 9,946,912 shares and closed the day at $1.57; the low close in the window was $1.47 on 26 June 2026 [71].

The control-bloc record, including the 2026 change to the related-persons table that the press reported as a sale, is set out in People [72]. At a quarter of book, no member of the control bloc and no director has bought a share in the open market.

What would move the read

The read this chapter lands on: the discount is wider than the company's returns alone justify, and the residual — the part that is an asset-quality claim — requires ultimate losses on the two credit books of a size the provisioning and recovery record has not yet produced, while a stress well beyond anything recognised still leaves book value at roughly three times the current price. Two facts sit against it. The rating agencies looking at the same loans moved the outlook to negative in April 2025 and cut the grade in May 2026, with $88.3m of bonds to refinance within a year. And the only listed peer trades at the same multiple with a worse income statement, which locates much of the discount in the sector rather than in this balance sheet, and makes a re-rating dependent on more than this company's own disclosures. Four things would decide it, all checkable on a date:

The statement of appropriation in the FY2026 annual report, due March 2027, will show whether the dividend again required a transfer out of the remaining $48.9m of share premium, or whether separate-basis profit covered it.

The trust-account balance and allowance rate in each quarterly report: the March 2026 quarter combined a $44.9m fall in the gross book [73] with a rise in the allowance rate to 25.28% [74]. That combination continuing is the workout converging; the gross balance turning up again, or the rate rising on a flat balance, is not.

Any first dividend from Korea Asset Capital to the parent, or a second treasury cancellation. The subsidiary holds $329.1m of equity and has never paid one, as Where Book Value Sits records; capital moving up would be the first evidence that the group intends to convert surplus regulatory capital into shareholder return rather than into more lending.

The next rating action. The grade has held investment-grade throughout the workout; a move below A- would change both the funding cost on the $218.0m bond stock and the evidential weight of the credit market's opinion, which is currently the main check on the reading above.

On a ten-year view the corpus supports less. The five-year adjusted-ROE average of about 5.4% is the only through-cycle anchor in the record; at a 10% cost of equity it justifies about 0.54 times book, $3.38 a share, and at 12% about 0.45 times, $2.81. What sits behind that anchor is structural rather than financial: History covers twenty-five years of a business assembled in 2001 and 2002 out of the land-trust portfolios of two failed predecessors, and Industry identifies the same mechanism running across the sector — a fee business that stands behind other parties' performance, so a downturn cuts fee volume while raising the exposure the trustee carries. What the corpus does not contain is ten-year evidence on this company as a listed one: it has been listed since July 2016 and has run a single property cycle since. The three-to-five-year question can be bounded from the record above; the ten-year one cannot be settled from it.