Seoul's National Assembly Research Service says in the new report, an analysis of the third session of the 14th Supreme People's Assembly in Pyongyang, Kim Yo Jong's role in the leadership could be growing, local news service Newsis reported.
"It cannot be ruled out Kim Yo Jong's status and role extends to the role of the central leadership," or successor to brother Kim Jong Un, according to the South Korean analysis.
Speculation regarding the North Korean leader has not abated since an unconfirmed report in South Korea suggested he was in critical condition following heart surgery. North Korea watchers have pointed out Kim Jong Un is overweight, smokes and enjoys foods high in cholesterol.
The parliamentary report said Kim Yo Jong was reappointed an alternate member of the ruling Workers' Party's Central Committee Politburo. She has also issued statements addressing the United States and South Korea in her name. As a member of North Korea's ruling family and heir to the "Paektu bloodline," she is well positioned to expand her power and influence, the report says.
The analysis added Kim Yo Jong's rise could take time.
South Korea has officially dismissed rumors of Kim Jong Un's ill health. No unusual movements have been detected, Seoul has said.
Analysts working for state-run think tanks are rejecting the notion Kim Yo Jong was promoted with her recent reappointment, according to Newsis.
In the North Korean leader's absence, senior North Korean officials are taking turns in field guidance visits to various sectors in the country.
Party paper Rodong Sinmun reported Wednesday senior politician Pak Pong Ju visited Pyongyang No. 1 Department Store and a textile factory in Pyongyang.
Pak ordered the production of "more fabrics of various colors," according to the Rodong.