HONG KONG (Yonhap News) ― Shares of Korean telecom giant KT Corp. are seen as undervalued among foreign investors, as Korea’s telecom industry is expected to further expand, boosted by smartphones, financial sources here said Monday.

“Institutional investors in Hong Kong as well as in Singapore are looking into opportunities to buy KT shares, as they consider those shares are substantially undervalued,” a Hong Kong-based financial official told Yonhap News Agency, asking for an anonymity.

A different financial source explained that the recent volatility on Korea’s stock markets has dulled investors’ appetite for riskier assets and increased preference for shares with stable dividends.

“Due to a regulated environment and fierce competition in Korea’s telecom industry, the country’s telecom operators saw relatively slow growth, compared to their overseas peers,” he said.

The investors are paying close attention to how the Korean telecom sectors will be affected by robust growth of smartphones.

KT Corp. reported last month that its fourth-quarter earnings fell below expectations, but painted a brisk outlook as rising smartphone sales, led by Apple Inc.’s iPhone, are expected to improve its margin.

Net profit reached 105.1 billion won ($94.3 million) in the October-December period, compared with a net loss of 430.5 billion won a year earlier, it said in a regulatory filing. The loss in the earlier period was caused by early retirement packages.