Shares of Lotte Group subsidiaries continued to stagger on Wednesday following anti-Japanese sentiments due to trade restrictions on exports of key raw materials to local tech conglomerates.
The retail giant with its owner family’s roots in Japan is in hot water due to its association with popular Japanese brands including Uniqlo and Asahi.
Shares of Lotte Corp holding company of Lotte Group closed nearly 1.5 per cent lower from the previous session at 40,400 won ($34.19).
Lotte Shopping, which holds a 49 per cent stake in FRL Korea, the local subsidiary of Fast Retailing Group that owns Uniqlo, saw its shares drop 1.66 per cent from the previous close to 148,000 won. The share price of Lotte’s key retail arm has dropped for three consecutive trading days.
Lotte Chilsung, which established a joint venture with Japan’s major beer company Asahi Group Holdings, also saw its share price fall 1.56 per cent to 158,000 won.
Lotte International, which owns 40 per cent stake in Muji Korea, is not a listed company.
Even affiliates with less connection to Japanese brands in terms of retail, such as Lotte Chemical, saw the share price fall 0.6 per cent to 248,500 won.
Unlike stocks related to Lotte, the latest sentiment sparked a rally in stocks of firms that consumers see as domestic alternatives to Japanese products and brands.
Hite Jinro, a major liquor producer which reported a 41 per cent year-on-year rise in soju sales in Cambodia last year, saw its shares rise 0.46 per cent to 21,700 won. The share price has been rising for two consecutive days.
But shares of Shinsung Tongsang, the firm behind local fashion brand Topten, dropped 0.35 per cent to 1,405 won in the same period, failing to extend its gains from Tuesday. Its shares had spiked 18.75 per cent the previous day.
On categorising the shares through consumer sentiments, analysts warned investors to take a cautious approach.
“It is true that anti-Japanese sentiment is affecting the stock market, but it is not certain that it will lead to a drop in the firms’ overall performance and sales,” said Hwang Se-woon, a senior researcher at Korea Capital Market Institute. THE KOREA HERALD