Beyond the '60,000 Won Electronics' as if mocking the dream of '100,000 Won Electronics'... Foreigners sell 'Samsung Electronics', but retail investors...

[Asia Economy Reporter Lee Seon-ae] Samsung Electronics has fallen into the "50,000 won electronics" trap. As it continuously hits new lows, the days when it dreamed of becoming a "100,000 won electronics" now seem like a mockery, and even reaching "60,000 won electronics" appears difficult.

According to the Korea Exchange on the 17th, Samsung Electronics closed at 56,200 won the previous day. During the session, it dropped to 55,500 won, setting a new 52-week low. This came just four trading days after breaking the 52-week low of 55,600 won on the 8th. Compared to the 80,800 won recorded on December 24 last year, the stock has fallen more than 30% in just over nine months. At that time, the target price was dreaming of "100,000 won electronics."

The decline in Samsung Electronics' stock price was driven by a selling spree from foreign investors. The surge in the won-dollar exchange rate led foreigners to unload large volumes of Samsung Electronics shares. On the 16th, foreigners net sold 103.49397 billion won worth of shares, making them the biggest sellers of Samsung Electronics stock this week. Institutions also sold Samsung Electronics (45.58916 billion won), second only to POSCO Holdings (56.71745 billion won). Only individual investors' affection for Samsung Electronics remained unchanged. This week, individuals net bought 140.39711 billion won worth of Samsung Electronics shares.

If the period is set to last month, the scale is even more overwhelming. Since last month, foreigners have net sold 1.014 trillion won worth of Samsung Electronics shares. Analysts attribute this to the Federal Reserve's (Fed) strong monetary tightening stance, resulting recession fears, and the strong dollar phenomenon, which fueled foreign selling pressure. Institutions also joined in, selling 1.515 trillion won worth of shares. On the other hand, individuals bought 2.462 trillion won worth during the same period.

Fortunately, the securities industry believes that since Samsung Electronics' current stock price is around a price-to-book ratio (PBR) of 1, the possibility of a further significant decline is low. However, they expect the investment period to be lengthy. This means that while it is considered the bottom, a rebound will not be easy.

Kim Kwang-jin, a researcher at Hanwha Investment & Securities, said, "The memory industry entered a downcycle from the first quarter," adding, "Considering weak demand in the front-end market and rising inventory levels among memory companies, this will continue until the first half of next year."

According to financial information provider FnGuide, Samsung Electronics' sales consensus for this year has been continuously revised downward over the past three months, and it is expected to increase by 12.56% year-on-year to 314.7248 trillion won. Operating profit consensus for the same period is estimated to increase by 3.79% to 53.5902 trillion won. Next year, operating profit is expected to decrease by 9.6% year-on-year to 48.4151 trillion won.

Shinhan Investment Corp. forecasted that Samsung Electronics' stock price could rebound as early as the end of this year or the first quarter of next year, with the industry recovering around mid-2023.

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