The artificial intelligence (AI) investment boom is fundamentally reshaping South Korea’s stock market. The rally has extended beyond semiconductor heavyweights Samsung Electronics (005930.KS) and SK Hynix (000660.KS) to high-value component makers and equipment manufacturers, while Hong Kong asset managers are aggressively increasing their bets on South Korea’s AI industry, citing lower valuations compared to U.S. competitors.<\/p>\n
According to the financial investment industry on the 5th, the top-performing stock on the KOSPI market in the first half of this year was neither Samsung Electronics nor SK Hynix, but Samsung Electro-Mechanics (009150.KS), the leading manufacturer of multilayer ceramic capacitors (MLCCs) for AI servers. Samsung Electro-Mechanics posted a staggering 756.47% gain in the first half. Its share price, which started the year around 270,000 won (approximately $176), skyrocketed to 2.18 million won (approximately $1,427) on the 30th of last month. This performance dwarfed SK Hynix’s 307.07% rise and Samsung Electronics’ 178.57% gain over the same period.<\/p>\n
Fueled by this explosive rally, Samsung Electro-Mechanics’ market capitalization swelled from 20.17 trillion won (approximately $13.2 billion, ranking 33rd on the KOSPI) at the start of the year to 163.13 trillion won (approximately $106.6 billion), catapulting it to fifth place on the KOSPI. Its preferred shares, Samsung Electro-Mechanics Preferred (009155.KS), also surged 585.34%, reflecting intense investor interest.<\/p>\n
South Korean brokerages are also betting on further upside for Samsung Electro-Mechanics. Major securities firms including Shinhan Investment Corp., NH Investment & Securities, KB Securities, Meritz Securities, Hana Securities, and iM Securities have raised their target price for the stock to 3 million won (approximately $1,960). That implies roughly 50% additional upside from the closing price of 1.989 million won on the 3rd. “Samsung Electro-Mechanics has entered a phase of structural growth, emerging as a leading global components manufacturer,” said Oh Kang-ho, an analyst at Shinhan Investment Corp. “It is a key beneficiary of expanding high-value product sales in the AI era.”<\/p>\n
The tailwinds from expanding AI server investments are spreading across the MLCC industry. The second-highest gainer on the KOSPI was Samwha Capacitor (001820.KS), another major MLCC producer, which surged 416.24% in the first half. “Price increases are possible in a lagging manner, following the moves of leading players like Samsung Electro-Mechanics and Japan’s Murata,” analyzed Lim Eun-young, an analyst at Samsung Securities. Third place went to Daewoo Engineering & Construction (047040.KS, up 393.19%), buoyed by expectations of winning a Czech nuclear power plant contract, while fourth place was claimed by SK Square (402340.KS, up 361.14%), the parent company benefiting from SK Hynix’s surge.<\/p>\n
On the KOSDAQ market, semiconductor equipment stocks dominated the top gainers. Jusung Engineering (036930.KQ), a semiconductor equipment maker, rose 625.63% to claim first place, followed by Gigavis (420770.KQ), a semiconductor package substrate defect inspection equipment company, which gained 510.16%. Daehan Fiber Optics (010170.KQ), a producer of optical cables and fiber optics, also surged 493.26%, demonstrating how expanding AI server investments are rippling out to telecommunications infrastructure-related stocks.<\/p>\n
Foreign capital is increasingly courting South Korea’s AI industry. The “2X SK Hynix Daily Leverage” ETF, listed on the Hong Kong Stock Exchange by CSOP Asset Management in October last year, recorded $16.8 billion in assets under management (AUM) as of the 23rd of last month, making it the world’s largest single-stock leveraged ETF. This surpassed the AUM of the Tracker Fund of Hong Kong ($16.2 billion), a flagship Hong Kong index ETF launched in 1999, claiming the title of the largest ETF on the entire Hong Kong stock exchange.<\/p>\n
CSOP’s aggressive moves did not stop there. Last month, the firm listed the “CSOP KOSPI 200” ETF on the Hong Kong Stock Exchange. It is the only ETF tracking the KOSPI 200 index in the Hong Kong market and the first KOSPI 200 ETF listed in the Asia-Pacific region outside of South Korea. The ETF employs a full replication strategy, directly holding the constituent stocks of the KOSPI 200, with the information technology (IT) sector accounting for approximately 66% of the portfolio. Notably, Samsung Electronics and SK Hynix alone represent roughly 60% of the total portfolio, making it effectively a concentrated investment vehicle for South Korea’s AI industry.<\/p>\n
Hong Kong capital is drawn to South Korea’s market based on the conviction that Samsung Electronics and SK Hynix will be the most direct beneficiaries as memory semiconductors become a core component in the expanding AI data center investment cycle. Furthermore, a key investment appeal is that South Korean semiconductor companies are trading at relatively low valuations despite earnings improvements, in stark contrast to the significant share price gains of U.S. AI semiconductor firms.<\/p>\n
“Samsung Electronics and SK Hynix are among the most profitable companies in the world, yet they remain undervalued compared to their U.S. peers,” said Wang Li, Chief Investment Officer (CIO) of CSOP Asset Management. “At least from our perspective, they are not expensive yet.”<\/p>\n
Optimism about the AI investment cycle also persists. While concerns about overinvestment in data centers and computing infrastructure were raised as recently as last year, analysts note that the rapid proliferation of AI agents and enterprise AI services has caused token usage to explode, further increasing the need for AI infrastructure investment. Beyond semiconductors, CSOP identified power equipment, energy infrastructure, shipbuilding, and defense as additional sectors poised to benefit from expanding AI investments.<\/p>\n","protected":false},"excerpt":{"rendered":"The artificial intelligence (AI) investment boom is fundamentally reshaping South Korea’s stock market. The rally has extended beyond…\n","protected":false},"author":2,"featured_media":75052,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18],"tags":[40714,8708,19018,40715,40718,39527,40717,19019,29022,337,127,3164,276,40716,275,676],"class_list":["post-75051","post","type-post","status-publish","format-standard","has-post-thumbnail","category-samsung-electronics","tag-2x-sk-hynix-daily-leverage-etf","tag-artificial-intelligence-ai","tag-csop-asset-management","tag-csop-kospi-200-etf","tag-daehan-fiber-optics","tag-daewoo-engineering-construction","tag-gigavis","tag-hong-kong-stock-exchange","tag-jusung-engineering","tag-korea-exchange","tag-samsung","tag-samsung-electro-mechanics","tag-samsung-electronics","tag-samwha-capacitor","tag-sk-hynix","tag-sk-square"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/75051","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/comments?post=75051"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/75051\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media\/75052"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media?parent=75051"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/categories?post=75051"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/tags?post=75051"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}