1. What Happened?

SK Plasma, a subsidiary of SK Discovery, agreed to provide up to ₩101.2 billion in financial support to its Indonesian affiliate, PT. SK PLASMA CORE INDONESIA. This represents a significant 30.16% of SK Plasma’s equity capital.

2. Why This Decision?

The primary objective is to stabilize the financial health of the Indonesian affiliate. This move is interpreted as an attempt to ease the affiliate’s debt burden, ensuring business continuity and mitigating potential management risks.

3. What’s the Impact?

Potential Upsides

  • • Stabilization and growth potential of overseas operations
  • • Strengthened corporate governance

Potential Downsides

  • • Increased financial burden on SK Discovery and SK Plasma
  • • Uncertainty regarding fund recovery and potential for bad debt
  • • Additional risks associated with interest rate and exchange rate fluctuations

4. What Should Investors Do?

  • • Scrutinize the fund recovery plan and collateral conditions.
  • • Analyze the Indonesian affiliate’s business performance and outlook.
  • • Monitor macroeconomic indicators, including exchange rates and interest rates.
  • • Keep an eye on SK Discovery’s capital efficiency and financial structure changes.