Samsung Group stock exchange-traded funds (ETFs) are posting rapid gains as a re-rating of Samsung Electro-Mechanics (009150) and Samsung SDI (006400) adds to Samsung Electronics' (005930) record first-quarter results. Market watchers attribute the rally to rising component demand from expanding artificial intelligence (AI) infrastructure investment combined with expectations of a recovery in the secondary battery sector.
According to the Korea Exchange on Monday, KODEX Samsung Group has risen 26.48%, TIGER Samsung Group 28.45%, and ACE Samsung Group Sector Weighted 23.77% this month. These stand out among major group stock ETFs. WON Doosan Group Focus gained 22.81%, TIGER LG Group Plus 20.49%, and PLUS Hanwha Group Stock 15.08%, all trailing the KOSPI's 23.09% gain. On a year-to-date basis, KODEX Samsung Group is up 52.83%, TIGER Samsung Group 57.12%, and ACE Samsung Group Sector Weighted 51.95%, well above the 50% mark.
Samsung Electronics accounts for more than 30% of Samsung Group stock ETFs. The chipmaker posted a super earnings surprise with first-quarter operating profit of 57 trillion won ($40 billion) and is approaching the 220,000-won mark. Samsung Electronics shares jumped 28.59% this month from 189,600 won to 215,000 won. The market expects semiconductor prices to continue climbing through next year amid a memory shortage, and Samsung Electronics Chairman Jay Y. Lee reportedly told group executives repeatedly that "there are no chips." According to financial data provider FnGuide, the three-month brokerage consensus estimate for Samsung Electronics' full-year operating profit stands at 301.6243 trillion won, up 591.8% from a year earlier. Target prices have been set as high as 360,000 won (KB Securities) and 400,000 won (SK Securities).
Samsung Electro-Mechanics and Samsung SDI have added momentum to ETF returns. Samsung Group stock ETFs include both companies among their top five holdings, each at around 10%. Samsung Electro-Mechanics shares closed at 680,000 won Monday, surging 67.12% this month and rising for nine consecutive trading sessions from Oct. 8. Its market capitalization ranking jumped eight notches from 21st to 13th. Samsung SDI also extended gains for a fourth consecutive session since Oct. 15, closing at 538,000 won Monday. Its monthly gain reached 32.11%.
Analysts view the recent strength in Samsung Group stocks as the AI investment boom, previously concentrated on Samsung Electronics, spreading across the group. After Samsung Electronics led the market for more than six months, buying has extended to related industries spanning semiconductors, automotive electronics, power grids, and batteries, lifting Samsung Electro-Mechanics and Samsung SDI.
For Samsung Electro-Mechanics, rising AI server demand has highlighted structural growth in multilayer ceramic capacitors (MLCCs) used in smartphones, servers, and automotive electronics, as well as flip-chip ball grid array (FCBGA), a high-value packaging substrate. Hana Securities raised its target price for Samsung Electro-Mechanics to 810,000 won on the medium- to long-term earnings growth outlook.
Samsung SDI is benefiting significantly from the re-rating of secondary batteries following the Middle East conflict. The company has shown strong performance as U.S. utility-scale energy storage system (ESS) installations grow, supported by expanded North American production capacity and advanced manufacturing production credit (AMPC) benefits. For electric vehicle (EV) batteries, expectations of an earnings-driven turnaround are emerging as utilization rates are expected to recover, led by Europe. Samsung SDI also signed a battery supply contract with Mercedes-Benz on Monday.
Goldman Sachs on Monday raised its 12-month KOSPI target to 8,000 from 7,000, citing continued fundamental improvements across Korea's semiconductor and industrial sectors. JPMorgan also raised its KOSPI target to as high as 8,500 from 7,500, the highest in two months. "This economic cycle is being driven by AI and future-oriented investment, so related stocks are likely to continue leading the market going forward," said Jung Yong-taek, senior research fellow at IBK Investment & Securities.
