Is Samsung Electronics Also Planning 100 Trillion Won in Shareholder Returns? KOSPI Surges on High Expectations

[Anchor]

Following SK hynix's announcement after the market closed yesterday (August 19) of a 40 trillion won treasury stock buyback, the South Korean stock market cheered significantly today. Samsung Electronics also rose in tandem after signaling a record-breaking scale of shareholder returns, leading a sharp rebound for the KOSPI.

Reporter Min Gyeongho has the details.

[Reporter]

SK hynix shares closed with a massive 12.7% surge today.

A massive treasury stock buyback disclosure released after the market closed yesterday proved decisive.

The market had previously projected SK hynix's total shareholder return for this year to be around 40 trillion to 60 trillion won, with about half—ranging from 20 trillion to 30 trillion won—allocated for treasury stock buybacks.

However, the unexpected 40 trillion won announcement sparked expectations that the overall scale of shareholder returns would be even larger, sending the share price soaring.

Samsung Electronics also jumped 9.49% amid expectations that it will finalize a shareholder return policy in the range of 100 trillion won as early as this month.

The market is fueling expectations for further gains based on the past scale of shareholder returns by the two companies.

Samsung Electronics allocated about 10 trillion won for shareholder returns when its stock price was around the 70,000 won level, while SK hynix spent about 1 trillion won when its stock was hovering around 100,000 won.

The sentiment is that if their shareholder return scales expand to 100 trillion won and 60 trillion won, respectively, their stock prices could potentially rise by a proportional margin.

Furthermore, market consensus is that regardless of the cyclical fluctuations inherent in the semiconductor industry, sufficient operating profit is already secured at least through the year after next.

Therefore, the perception that large-scale shareholder returns will not end as a temporary gift but can be sustained is also viewed as positive for future momentum.

[Interview / Kim Dong-won, Head of Research Division, KB Securities : Investors do not buy stocks just because they offer high dividends when earnings are poor. It holds great significance that (Samsung Electronics and SK hynix) simultaneously satisfy both investment merits.]

Additionally, as the U.S. government announced plans to increase the scale of its bond buybacks—repurchasing previously issued bonds—falling bond yields acted as another favorable factor, helping the KOSPI close up 5.8% at 6,852 today.

(Video reporting: Lee Moo-jin, Video editing: Kim Jun-hee)
※ Please note: This article was translated by AI and may contain errors.