SK hynix foreign ownership peaks…Will share prices soar?

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SK hynix foreign ownership peaks…Will share prices soar?

PUBLISHED :March 09, 2024 - 15:35
UPDATED :March 09, 2024 - 15:42

The main plant of SK hynix in Icheon, Gyeonggi Province

Foreign investors have been flocking to SK hynix, South Korea’s chipmaker, driving their ownership to record highs.

As the chipmaker’s foreign ownership is reaching a peak, market insiders and domestic investors are paying attention to whether the company’s share prices will go further.

According to the Korea Exchange on Saturday, foreigners held 54.35 percent of SK hynix shares as of Thursday, the last day for which data is available, the highest level ever.

The foreign ownership rate, which had been hovering around the 53 percent level since late last year, also increased after entering the 54 percent range for the first time on Feb. 23.

SK hynix's ranking among the top foreign net buyers this year has also been steadily rising.

In January, SK hynix was the third most bought stock by foreigners, but it jumped to second place in February. This month, it overtook Hyundai Motor Co. to take the top spot.

By the eighth day of the month, net purchases amounted to 490 billion won.

As a result, SK hynix shares were up 10.05 percent this month. On Friday, it closed at 171,900 won per share, up 4.24 percent, to hit an all-time high.

This is in contrast to Samsung Electronics, which was down 0.14 percent this month.

The electronic signboard at Hana Bank shows the trading indexes of major countries' stock markets on Friday. (Yonhap)

Foreigners have been selling Samsung Electronics in large numbers, adding to the downward pressure.

Samsung Electronics was the most bought stock by foreigners in January, but fell to seventh place in February as a net buyer. This month, it has been among the top sellers.

Market watchers said many sellers shifted their focus to SK hynix, which has a large market share in high-bandwidth memory (HBM), as Nvidia's strong earnings raised expectations of rising demand for HBM, a semiconductor used in artificial intelligence (AI).

"SK hynix has a monopoly in high-bandwidth memory, which is benefiting from the AI momentum," Yonhap News quoted Kim Sun-woo, a researcher at Merits Securities as saying. "There is talk of a widening gap between SK hynix and Samsung Electronics for next-generation HBMs, which is likely to drive more demand for SK hynix, which has more growth potential," he was quoted as saying.

Individuals, on the other hand, have been selling off SK hynix and buying Samsung Electronics this month in contrast.

By Investor News (investor@heraldcorp.com)

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