Capital markets have a crucial role in the efficient allocation of a nation’s capital stock, with low valuations being a signal of inefficiencies in this system. The nation of South Korea has notably exhibited suppressed valuations compared to international peers, giving rise to the phenomenon known as the “Korean Discount”. A prominent explanation for the valuation gap is the agency costs and weak corporate governance structures observed within the large family owned conglomerates knows as Chaebols, which accounts for a major part of the South Korean economy. With the use of a Correlated Random Effects model and an unbalanced panel of 950 unique firms on the South Korean stock market, this study set out to assess whether the Korean Discount is a market-wide phenomenon or mainly Chaebol-specific. Findings of this study indicates that Chaebol-affiliated firms exhibit a price-to-book discount of -26.79% in comparison to non-Chaebol firms during the period 2011-2024, after controlling for fundamental factors. The empirical findings suggest that investors perceive Chaebols to have residual loses that are not as prevalent within non-Chaebol firms, an issue that Chaebol management, policymakers and investors alike should address to solve the Korean Discount, which may in turn benefit South Korean capital markets and society as a whole.