In a report released on February 2, Hana Securities suggested that the domestic art auction market, led by Seoul Auction, may be entering a rebound phase. The report, authored by analyst Park Chansol, noted that uncertainties surrounding transactions have partially eased following the passage of the tax revision bill. Amid continued increases in real estate and equity prices, artworks may once again emerge as a store of value.

The core of the report lies not merely in evaluating a single stock, but in assessing whether the market structure has passed its bottom. Hana Securities stated that if Seoul Auction and K Auction each expand their consignment volumes to over KRW 10 billion (approximately USD equivalent) per auction season, this could be interpreted as a clear signal of a full-scale market rebound.

Preconditions for Rebound: Tax Environment and Asset Prices
 
The tax revision bill passed at the end of 2025 is cited as a factor that has partially alleviated the wait-and-see attitude among high-net-worth individuals. The art market, by its nature, is highly sensitive to tax and policy signals.
 
At the same time, as prices of major asset classes such as real estate and equities continue to rise, the possibility of portfolio diversification into artworks is being raised. The market boom of 2021 similarly coincided with a broader asset price upcycle.
 
From an investment perspective, this suggests that artworks may once again be re-evaluated not merely as consumer goods but as alternative assets. However, as an alternative asset class, artworks are characterized by low liquidity and limited price discovery. While returns may expand in bull markets, transactions can stall during downturns. Any investment approach must take these structural characteristics into account.

Real Indicators: Consignment Volume and Total Sales
 
In the auction market, the most reliable leading indicators are total consignment volume and clearance rates. Hana Securities noted that if individual auction houses increase consignment volumes to over KRW 10 billion during the April–June auction season, this would constitute a genuine recovery signal. This benchmark reflects whether market sentiment is translating into actual lot composition.
 
Seoul Auction currently holds the largest market share in the domestic auction sector. Together with K Auction, the two companies account for approximately 90% of the Korean art auction market, forming an effective duopoly. Their consignment strategies and auction results effectively determine the direction of the domestic market.
 
From a collector’s standpoint, this period is particularly significant. The early phase of expanding consignment volumes often corresponds to a transitional stage just before prices begin to rise in earnest. Conversely, once blue-chip works become overheated, entry costs escalate sharply. Therefore, first-half auction results serve as a critical indicator for assessing acquisition timing.

Valuation Perspective: Remembering 2021
 
The report references the 2021 boom period as a key comparison point. At that time, Seoul Auction recorded KRW 79 billion in revenue and KRW 19.7 billion in operating profit, reaching a market capitalization of approximately KRW 700 billion.
 
Given that the company’s business structure has not undergone significant changes, Hana Securities believes that similar valuation multiples could be applied if demand rebounds. In other words, an expansion in total auction sales could directly lead to a revaluation of corporate value.
 
For investors, the key variable is the direction of total auction sales. In the short term, quarterly hammer totals and increases in consignment volumes serve as leading indicators for corporate performance and share prices. If total auction sales begin to show double-digit year-on-year growth, this could justify a reassessment of valuation multiples.


 
The Mid-Low Price Segment and the Art Fair Variable
 
The report interprets the recent increase in art fair attendance as a signal of recovery in the mid- to lower-priced segment. This segment is closely tied to the inflow of new collectors.

From a collector’s perspective, as the mid-market stabilizes, the market base broadens and excessive price concentration on certain blue-chip artists may ease. In the long term, this can reduce price volatility and strengthen overall market resilience. From an investment standpoint, expansion in mid-priced transactions provides a more stable revenue foundation. While high-value works tend to be volatile, mid-tier transactions offer greater repetition and turnover.
 
 
 
Risk Factors and Strategic Implications

The rebound thesis hinges on three conditions.
 
First, whether actual consignment volumes meaningfully expand during the first half of the year. Second, whether clearance rates remain consistently above 70%. Third, whether total hammer prices for high-value blue-chip works show meaningful quarter-on-quarter growth.
 
Investors should focus less on short-term headlines and more on the trajectory of consecutive quarterly data. Collectors, meanwhile, should avoid overheated short-term cycles and selectively approach the market during the early phase of recovery following price corrections.
 
 
 
Conclusion: At the Threshold of Structural Recovery

Hana Securities concluded that Seoul Auction’s auction-related performance has likely passed its bottom, and that the company’s stock price may soon enter an upward trend. However, the auction results of the first half of 2026 will represent more than corporate earnings. They may serve as a turning point in assessing the structural direction of the entire Korean contemporary art market.
 
The consignment strategies of Seoul Auction and K Auction, the strength of blue-chip artist results, the resilience of the mid-market, and the broader asset price environment must align simultaneously. Only then can the current rebound signal evolve from a temporary recovery into a structural shift. For investors, this is a moment that calls for data-driven and gradual positioning. For collectors, it demands selective acquisition strategies and a long-term perspective.