Foreign investors’ holding of shares in Samsung Electronics Co. reached the highest levels this year, after they scooped up about 1.4 trillion won ($1 billion) worth of the stock over the past five trading sessions amid brewing optimism in the semiconductor sector.
With the South Korean benchmark stock index Kospi extending a record-setting rally this month, offshore investors now own 51.25% of Samsung shares.
They chased higher the world’s largest memory chipmaker following news on Friday that Samsung recently passed Nvidia Corp.’s qualification tests for its fifth-generation 12-layer HBM3E after a string of failed attempts to meet its performance standards.
The news underscored growing optimism in the semiconductor sector, fueled by accelerating AI hype. Analysts expect foreign investors to continue their buying spree of Samsung Electronics.
“At the peak of the computer server cycle in 2018, foreign investors held 58% of Samsung Electronics shares,” said Kim Soo-yeon, an analyst at Hanwha Investment & Securities.
“In August last year when the AI-driven market enthusiasm prevailed, their ownership stood at 56%. There is more room for foreign investors to buy Samsung shares,” she added.
The current sentiment is in stark contrast with the net selling by foreigners in Samsung Electronics last month, following its disappointing second-quarter results.
On Tuesday Samsung’s share price closed up 1.44% at 84,700 won, its strongest finish so far this year.
In pre-market trading, it surpassed the 90,000 won threshold for the first time, climbing as high as 91,000 won. But the price is still below Morgan Stanley’s latest target price of 96,000 won.
On Tuesday, the Kospi continued its upward streak to touch its historic high of 3,494.49. By market close, it pared the gains to finish up 0.51% at 3,486.19. It again marked its highest-ever closing level.
Celltrion, a leading biosimilar maker, was the second-most bought stock by foreign buying over the same period, during which they have snapped up 118.4 billion won worth of the stock, according to the Korea Exchange.
The stock got a new boost from its announcement that it has acquired Eli Lilly and Company’s plant in Branchburg, New Jersey for about 460 billion won ($330 million), securing its first US manufacturing base as a hedge against possible hefty US tariffs on imported drugs.
On Tuesday, its share price leapt 8.93% to end at 184,200 won.
Samsung Electro-Mechanics Co. ranked third among stocks most heavily bought by foreign investors, with a net purchase of 116.9 billion won over the past five trading sessions.
The producer of multi-layer ceramic capacitors (MLCCs) is another beneficiary of the AI boom, claiming Google Inc., Meta Inc. and Amazon.com as customers.
MLCCs act as dams that charge and discharge certain amounts of electricity to control power flow and are equipped in AI chips used for servers.
“Demand for MLCCs for automotive electronics and industrial applications is rapidly growing,” said Park Sang-hyun, analyst at Korea Investment & Securities.
“We’re in the early stage of an MLCC supercycle with supply shortages expected next year.”
Kosdaq-listed machinery company Robotis Co., Sam Chun Dang Pharm Co., LG Electronics Inc., Samsung C&T Corp. and Lotte Tour Development Co. are among the top 10 stocks foreign investors have bought heavily.
By Han-Gyeol Seon
always@hankyung.com
Yeonhee Kim edited this article.
