[News Space=Reporter seungwon lee] In the first half of 2025, CJ Group stocks are recording a remarkable rise in the domestic stock market, drawing investors' attention. The government's policy to improve governance structure, K-content development policy, and expectations of large-scale mergers among key affiliates within the group are all working together to drive the stock price rally.
CJ Group stocks are showing an unusual rise in the domestic stock market in the first half of 2025. Investors' attention is focused on the government's policy to improve governance structure, foster the K-content industry, and expectations of mergers between major affiliates within the group.
According to the Korea Exchange, as of July 3, CJ (holding company) rose 59.74% this year, CJ ENM rose 32.59%, CJ Korea Express rose 7.11%, and CJ CheilJedang rose 4.31%. CJ CGV, the only group stock that had been sluggish, also rebounded 6.74% in June, making up for its decline, and the overall rally continues.
Expectations for improvement in governance structure and revision of commercial law, highlighting the premium of holding companies
The strength of CJ Group stocks is directly due to expectations of the new government's efforts to strengthen transparency in governance and to revise the Commercial Act. The government has set out innovation in corporate governance, such as separating the CEO and the chairman of the board, and strengthening protection of general shareholders, as key tasks.
The securities industry is seeing a high possibility of a reevaluation of the value of holding companies, saying that “the conflict of interest between controlling shareholders and general shareholders, which was the main factor in the discount of holding companies, will be resolved.”
CJ-Olive Young merger rumors, succession and corporate value simultaneously highlighted
In the market, the possibility of a merger between CJ and Olive Young is acting as a driving force for the rise in the group's stocks. Olive Young recently exercised the call option for 11.3% of its own stocks held by a special purpose corporation (SPC) early, increasing its own stock ratio to 22.6%. This is interpreted as a measure to reorganize external shares and lay the groundwork for a merger with CJ.
The securities industry evaluated that “if the merger becomes a reality, concerns about duplicate listings will be resolved, and the corporate value of Olive Young will be fully reflected in CJ, significantly increasing the value of the holding company.”
iM Securities predicted that “if the merger takes place, CJ’s stock price will rise to at least 150,000 won.” In fact, the prevailing analysis is that the merger will also be beneficial to the succession of the third generation of owners.
K-OTT Promotion Policy, Expectations for 'Mega Platform' through Tving-Wave Merger
The Lee Jae-myung government’s policy of fostering K-content and indigenous OTT (online video service) is also having a strong positive effect on media affiliates such as CJ ENM. The government has put forth comprehensive support measures such as establishing an original content production fund, tax support, global distribution, and IP protection, and emphasized that “OTT platforms should also be led by the government.”
Amidst this policy wind, the merger of CJ ENM’s Tving and SK Square’s Wave has received conditional approval from the Fair Trade Commission, and the domestic OTT market landscape is changing. Once the merger is complete, the two platforms will have 11.27 million monthly active users (MAU), making them the second-largest OTT operator in Korea after Netflix (14.5 million).
The securities industry analyzed that “the merger is expected to produce synergies such as increased subscribers, reduced production costs, and enhanced negotiating power.”
NH Investment & Securities raised its target stock price for CJ ENM by 29% from 73,000 won to 94,000 won, stating that “the main beneficiaries are the K-content activation policy, the merger of Tving and Wave, and the easing of Korea-China relations.”
Affiliates such as CGV, Daehan Transportation, and Cheil Jedang also expect to benefit from the policy
CJ CGV is expected to see additional rebound in the second half of the year due to growth of Asian corporations and improvement in financial structure, CJ Korea Express is expected to see domestic demand stimulus measures, and CJ CheilJedang is expected to see expansion of global food and bio businesses. In particular, CGV's stock price is expected to be directly affected by whether or not it holds a drag-along event and its Asian performance recovery.
Investor Advice and Market Outlook
Experts unanimously agree that “CJ Group’s rally is based on structural changes and policy momentum,” and that “if the merger and restructuring become a reality, there is a high possibility of additional stock price increases.” However, they also advised that caution is needed regarding remaining procedures such as calculating the merger ratio and obtaining shareholder approval, as well as market volatility.
The structural rebound shown by CJ Group stocks is not just a simple recovery in business conditions, but is the result of the innovation of the governance structure of large Korean companies and the global strategy of the K-content industry. It remains to be seen whether the synergy created by the two axes of merger and policy will continue in the second half of the year.