In a remarkable turn of events, foreign investment funds flowing into Samsung Group stocks, including Samsung Electronics Co., have reached a staggering peak not seen in the past 23 years since 2000. The surge can be attributed to the explosive rise of AI chip-related stocks, such as Nvidia, in the U.S. stock market.

According to data from the Korea Exchange on Wednesday, foreign investors have made substantial net purchases of Samsung Electronics shares, amounting to a whopping 10.26 trillion won ($7.77 billion) as of May 30 this year. Notably, this figure surpasses the previous record set in 2000, when foreign investors made net purchases of 3.59 trillion won during the same period. The net purchase of preferred shares of Samsung Electronics also witnessed a remarkable upswing, reaching 354.1 billion won, the highest level since 2000, surpassing the previous record of 198.2 billion won. This surge marks the first time since 2019, with a net purchase of 2.91 trillion won. It is worth mentioning that foreign investors had sold a net total of 7.1 trillion won worth of Samsung Electronics shares during the same period in 2020, followed by 10.92 trillion won in 2021, and 5.47 trillion won in 2022.

The influx of foreign investment has not been limited to Samsung Electronics alone but has encompassed the entire Samsung Group. Foreign investors have made significant net purchases of shares in 23 Samsung Group companies, including preferred shares, amounting to 13.3 trillion won during this period. This also represents the largest net purchase since the record set in 2000, which stood at 4.48 trillion won. Following Samsung Electronics, the stocks that garnered the highest net purchases by foreign investors include Samsung SDI with 1.01 trillion won, Samsung Engineering (363.4 billion won), and Samsung Life Insurance (307.6 billion won).

The influx of over 10 trillion won in foreign investment into Samsung Electronics this year has led to a record-breaking foreign ownership ratio. As of May 30, foreign investors held 52.34 percent of South Korea’s top stock, marking the highest level since August 13, 2021, when it reached 52.65 percent.

After dropping to the 49 percent range in the latter half of last year, foreign ownership has experienced a resurgence, surpassing the 50 percent mark again.

The year 2021 proved to be challenging for Samsung Electronics, as concerns over economic downturns and worsening semiconductor market conditions led foreign investors to sell a significant 8.71 trillion won worth of shares, causing a sharp decline of nearly 30 percent in its stock price.

However, the tables turned in April this year when Samsung Electronics announced memory chip production cuts, leading to an accelerated recovery in stock prices. In just 14 months, the company successfully regained the 70,000 won level. Although the company is currently grappling with substantial losses in its semiconductor business, analysts anticipate a strong rebound in performance starting from the second half of this year.

The average brokerage target price for Samsung Electronics was 82,476 won as of Wednesday, up 6.3 percent from 77,571 won three months ago.

By Kang Min-woo and Minu Kim

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