1. What Happened? SK Square’s Treasury Stock Disposal

On July 24, 2025, SK Square announced its decision to dispose of 21,909 treasury shares, worth approximately KRW 3.4 billion, to fund long-term incentive payments. The disposal amount is insignificant compared to the total number of outstanding shares.

2. Why the Disposal? Understanding the Rationale

The treasury stock disposal aims to fund long-term incentives for employees and is expected to have a limited direct impact on the company’s financials. However, it can influence market sentiment, and investors should consider factors such as the lack of market expectations, potential short-term stock price fluctuations, and the interplay with strong Q3 earnings.

3. What’s Next? Market Outlook and Potential Impact

Short-term stock price fluctuations are possible, but the strong Q3 results are expected to offset this. However, macroeconomic factors like a potential global recession, rising raw material prices, interest rate hikes, exchange rate fluctuations, a slowdown in the Chinese economy, and the continued deficit of 11st pose greater risks to SK Square’s fundamentals.

4. What Should Investors Do? Actionable Insights

Instead of reacting to short-term stock price movements, investors should develop an investment strategy by considering SK Square’s mid- to long-term growth potential and the hidden risks. Continuous monitoring of the aforementioned macroeconomic factors and 11st’s performance is crucial.