Investment Ideas from MWC... Opportunities Arise in Semiconductor and Telecommunications Sectors

Confirmed Importance of AGI at MWC... Commercialization Timeline Expected to Accelerate
New Growth Opportunities Anticipated in Semiconductor Industry
Traffic Increase Forecasts Revenue Growth in Telecommunications Sector

The world's largest telecommunications exhibition, 'MWC 2024,' opened on the 26th (local time) in Barcelona, Spain. Global information and communication technology (IT) companies such as Microsoft, Intel, Samsung Electronics, Deutsche Telekom, and SK Telecom participated to showcase new AI-related technologies. The financial sector in Yeouido expects a positive impact on investment sentiment in the semiconductor and telecommunications sectors as interest grows in Artificial General Intelligence (AGI) and 6th generation (5G) communications.

According to the financial investment industry on the 28th, Gaon Chips' stock price has risen 71.8% since the beginning of this month. Considering that the KOSDAQ index rose 6.8% during the same period, the market-relative return reaches 65 percentage points.

The recent sharp rise in Gaon Chips' stock price is influenced by analyses predicting that global IT companies will make large-scale investments to develop AGI. Gaon Chips is considered a beneficiary related to Samsung Electronics' AGI developments.

Expectations are spreading through MWC that AGI will be commercialized faster than anticipated. Dongwon Kim, a researcher at KB Securities, introduced, "The core theme of MWC is undoubtedly AI," adding, "The key point is that AI is evolving into AGI, which can perform on par with or beyond human capabilities." He continued, "Introducing AI is not just a matter of facility investment but leads to significant changes in business models and strategies," emphasizing, "It is important to understand to what extent AI can replace human work."

The importance of AGI can also be confirmed through the strategies of IT companies competing to dominate the AI market. Meta stated that building AGI is essential to expand next-generation AI services. OpenAI shortened the timeline for realizing AGI close to human intelligence from 10 years to 1-2 years by releasing the generative AI Sora. SoftBank, which mentioned that all AI experts desire AGI, plans to invest 130 trillion won in developing AGI chips. Samsung Electronics recently established a dedicated AGI chip research organization in Silicon Valley, USA. Samsung Electronics is building an integrated production system from AGI chip design to manufacturing.

The reason the competition for AGI development has intensified is that to provide optimal AI services, all functional aspects of AI?including learning, reasoning, and coding?must evolve simultaneously. To reduce AGI chip development time and costs, collaboration among global IT companies is also likely to become more active.

The securities industry expects Samsung Electronics, SK Hynix, SK Telecom, and Gaon Chips to benefit. Researcher Kim said, "Meta, Microsoft, Google, OpenAI, and Samsung Electronics are focusing on developing their own AI semiconductors, AGI chips," and predicted, "Commercialization will occur within 1-2 years."

The advancement of AI technology inevitably causes an increase in traffic. This is why improvements in the performance of mobile carriers and telecommunications equipment companies are anticipated. Hongshik Kim, a researcher at Hana Securities, said, "Network evolution is essential for AI growth because it must handle massive traffic," adding, "Since switching to traffic-linked billing plans after 2014, telecommunications companies' revenues have increased as traffic grew." He further forecasted, "The global average annual traffic growth rate will exceed 30% until 2030."

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