Troika dominates top 30’s net profit

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Troika dominates top 30’s net profit

The combined net profit of Samsung Electronics, Hyundai Motor and Kia Motors is expected to account for more than half of the profits earned by Korea’s top 30 companies this year.

According to FNGuide, an online financial information provider, total net profit of the three companies for 2012 is estimated at 36.75 trillion won ($33.02 billion).

This is forecast to make up 55 percent of the 67.5 trillion won earnings projected for the leading 30 companies. Samsung Electronics, the world’s largest smartphone maker by shipments, is tipped to post a yearly net profit of 22.69 trillion won, representing just over one-third or 34 percent of the top 30 firms’ profits.

Hyundai Motor is expected to post 9.56 trillion won, or 14 percent of the total, with Kia Motors making up 7 percent based on 4.5 trillion won.

The combined net profit of the three companies last year stood at 25.4 trillion won.

Their combined operating profit will almost make up 50 percent of that recorded by the top 30 enterprises, FNGuide predicted, up from 38 percent or 27.9 trillion won last year.

Industry experts say the exceptional concentration of profits by the three is not healthy for the economy in the long run.

“When companies become extraordinarily bloated, their exposure to global risks could put the local economy at risk,” said Park Yong-rin, head of Korea Capital Market Institute’s corporate policy division.

“For example, if one goes out of business, the economy will be hurt as they take up a huge chunk of it,” he added. “So it is important to diversify the industries the government offers support to, while also expanding the number of key players to hedge possible risks.”

By Lee Sun-min [summerlee@joongang.co.kr]

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