Korea Hot Stocks-Woori Finance gains on privatisation hope

SEOUL Thu Dec 20, 2012 12:24am EST

SEOUL Dec 20 (Reuters) - South Korea's main KOSPI share index was up 0.26 percent at 1,998.37 as of 0505 GMT. The junior Kosdaq index fell 0.45 percent.

Stocks on the move on Thursday include

**WOORI FINANCE UP**

Shares of Woori Finance Holdings Co jumped to their highest levels in nearly three months after the election of South Korea's new president raised hopes of privatisation of the government-owned financial company.

KB Financial Group Inc was also named as a potential candidate to bid for Woori Finance after KB's board had rejected a plan to buy ING Groep NV's South Korean insurance unit, analysts said.

Conservative Park Geun-hye from the ruling party won South Korea's presidential election on Wednesday, beating her left-wing challenger, Moon Jae-in.

Woori Finance Holdings shares jumped as much as 5.3 percent.

**PARK'S WIN BOOST SMALL STOCKS **

A number of small-cap stocks which local media reports said were known to be related to South Korea's president-elect Park Geun-hye surged by the daily limit of 15 percent after the conservative ruling party lawmaker beat her left-wing challenger Moon Jae-in on Wednesday.

The shares affected include those reportedly owned by Park's brother or relatives - EG and Dayou Smart Aluminium .

"Relations to the president-elect is lifting sentiment for the firms. But they do not change the fundamental value of the companies," said Kim Hyeong-ryeol, an analyst at Kyobo Securities.

Baby product makers also surged, as Park, who will become the country's first female president in February, is known to try to address South Korea's low birth rates. They include Boryung Medience and Agabang & Company

In contrast, shares which are reportedly connected to Moon plunged by 15 percent. They include Wooridul Life Sciences and Barunson. (Reporting by Hyunjoo Jin; Editing by Eric Meijer and Anand Basu)