Hanjin Transportation Co., a South Korean logistics company, said Friday it will buy back 20 billion won ($17.7 million) worth of its shares to improve shareholder value.

Hanjin's board of directors approved the plan to buy its shares for six months ending on Sept. 12, the company said.

Hanjin said the company made the decision as its shares were believed to be undervalued despite its robust earnings last year.

"The parcel delivery business improved profitability thanks to a sharp hike in contactless consumption amid the COVID-19 pandemic, but the firm's share prices were overly undervalued for its corporate value," a Hanjin official said.

Last year, its sales rose 7.4 percent on-year to 2.2 trillion won, and its operating profit jumped 16.7 percent to 105 billion won thanks to solid demand for parcel delivery amid the pandemic. (Yonhap)