Stock prices of South Korean companies that have business ties with North Korea have risen sharply in recent months amid thawing inter-Korean relations, the Korea Exchange said Sunday.
The two Koreas have exchanged high-level delegations on the occasion of the PyeongChang Winter Olympics and agreed to hold summit talks in late April.
US President Donald Trump also agreed to meet with North Korean leader Kim Jong-un by the end of May as the South Korean delegation delivered Kim's offer for the summit to the US president.
The stock prices of 17 companies that have business ties with North Korea have risen 44.92 percent on average as of Friday compared with the end of last year, according to statistics provided by the KRX.
The benchmark KOSPI backtracked 0.33 percent and the tech-heavy secondary KOSDAQ market surged 8.44 percent during the same time span.
The stock price of clothing maker In The F, which has a factory in the Kaesong Industrial Complex in the North's border town, soared 110.53 percent to 2,200 won ($2.05) from 1,045 won.
Another apparel maker, Good People, also had its stock price nearly double during the period.
The previous Park Geun-hye government shut down the industrial complex, the brainchild of inter-Korean economic cooperation, in 2016 after North Korea's launch of ballistic missiles and test of a nuclear bomb, amid concerns the industrial complex was serving as a cash cow for North Korea's development of weapons of mass destruction.
The share price of Hyundai Elevator, the largest shareholder of Hyundai Asan, a South Korean operator of the now-suspended joint tour program to the North's scenic Mount Kumgang, also advanced 44.49 percent and that of Emerson Pacific, which runs a golf club in the Mt. Kumgang resort, rose 15.3 percent.
The resort has been closed since 2008 when a North Korean guard shot and killed a South Korean tourist there.
Industry sources are cautious about the rising stock prices of the firms that have business relations with North Korea, noting that expectations alone should not drive up the stock prices without the backing of economic fundamentals.
"Just like the local stock markets have become insensitive to North Korea's nuclear detonations, the impact of inter-Korean summit talks on the local markets has also decreased," Kim Min-kyu of KB Securities Co. said.(Yonhap)