SK Hynix Ants Overcome Slips and Climb Up

Individual Investors Net Buy 750 Billion KRW of SK Hynix This Month
Largest Scale This Year... 1.5 Times More Than 'Donghak Ant Movement' in March
Semiconductor Industry Faces Short-Term Downturn, Sparking Bottom-Fishing Rally

[Asia Economy Reporter Minwoo Lee] Despite SK Hynix's stock price declining, individual investors are flocking to it. Although uncertainties in semiconductor demand are increasing in the second half of the year due to the resurgence of COVID-19 and escalating tensions between the U.S. and China, investors are viewing this as a bottom and expect demand to recover from the first half of next year.

According to the Korea Exchange on the 28th, individual investors have net purchased SK Hynix shares worth 748.8 billion KRW so far this month until the day before. This ranks first in net purchases by individuals this month. This contrasts with last month when they net sold 265.7 billion KRW. Despite the steady decline in stock price, individuals have been buying SK Hynix shares. The stock price closed at 82,800 KRW, down 1.1% from the previous session. Compared to 93,000 KRW on the 8th of last month, the highest since March, it has dropped about 11%.

This is the first time this year that individuals have bought more than 700 billion KRW worth of SK Hynix shares in a month. The previous record was 467.7 billion KRW in March. When the fear of COVID-19 spread peaked and the KOSPI fell to the 1400 level for the first time in 11 years, individuals rushed into stocks in what was called the "Donghak Ant Movement." In the past month, individuals have bought about 1.5 times more SK Hynix shares than during that period.

Despite concerns over the resurgence of COVID-19 and U.S.-China conflicts causing uncertainty in semiconductor demand in the second half, the expectation of recovery from next year has led to bottom-fishing. The semiconductor industry widely expects a slight slowdown in the third quarter. Seungwoo Lee, a researcher at Eugene Investment & Securities, said, "Most global semiconductor companies, including SK Hynix, have reported results exceeding market expectations, but the second quarter is the peak, and a decline in semiconductor prices and earnings is expected in the second half." He added, "The demand for DRAM in the first half was largely influenced by customers securing safety stock in preparation for future uncertainties, so the second half is unlikely to reach the usual seasonal demand increase."

There are also forecasts for recovery as early as the fourth quarter. Mobile demand is already recovering, and new game console releases and Intel's new platform launch are scheduled. Doyeon Choi, a researcher at Shinhan Financial Investment, said, "The inventory levels of DRAM manufacturers are already below normal stock," adding, "Next year, DRAM demand is expected to improve significantly due to the spread of 5G smartphones and the transition to DDR5, but there has been no capacity expansion this year to prepare for this, so a sharp rise in DRAM prices reflecting supply shortages is expected from the first quarter of next year."

This content was produced with the assistance of AI translation services.