Samsung Electro-Mechanics Joins Emperor Stocks as ETFs Rush to Add Shares

Surpasses 1 Million Won for the First Time Since Listing... Up 303% This Year
Regarded as the Biggest Beneficiary of the AI Semiconductor Supercycle
Rapidly Added to Semiconductor ETFs

Samsung Electro-Mechanics has surpassed 1 million won, joining the ranks of so-called “emperor stocks.” Since the beginning of this year, the stock price of Samsung Electro-Mechanics has soared by more than 300%, driven by strong financial results and its emergence as a key beneficiary in the artificial intelligence (AI) semiconductor sector. As Samsung Electro-Mechanics becomes a central pillar in the AI semiconductor value chain, it is being rapidly incorporated into semiconductor exchange traded funds (ETFs).

According to the Korea Exchange on May 14, Samsung Electro-Mechanics closed the previous day at 1,029,000 won, officially becoming an emperor stock. The share price surged by more than 7%, crossing the 1 million won threshold for the first time since its listing.

Samsung Electro-Mechanics has maintained a steep upward trajectory in its share price throughout this year, rising by 303.53% since the start of the year. Having started the year in the 270,000 won range, the stock surpassed 400,000 won in February and broke through 500,000 won in April, eventually reaching 800,000 won. With the start of this month, it hit 900,000 won and has now reached the 1 million won milestone.

As a core supplier of AI components, Samsung Electro-Mechanics is considered the biggest beneficiary of the AI semiconductor supercycle, pushing its market value to unprecedented heights. Lee Changmin, a researcher at KB Securities, stated, “The rapid improvement in profitability for AI core components such as multilayer ceramic capacitors (MLCC) and flip chip ball grid array (FC-BGA) is being quickly reflected in earnings, suggesting explosive performance growth going forward.”

With rising demand, the company has expanded its capital expenditure (CAPEX), which has secured its medium- to long-term growth potential. Park Junseo, a researcher at Mirae Asset Securities, commented, “We estimate Samsung Electro-Mechanics’s CAPEX will approach 3 trillion won this year, and this trend will continue for several years. Reflecting the significant increase in CAPEX, the long-term growth potential of FC-BGA for AI servers and networks, and AI MLCC, as well as price increases for FC-BGA and MLCC, we are raising our target price by 145% from 530,000 won to 1,300,000 won.”

As Samsung Electro-Mechanics establishes itself as a core supplier in the AI semiconductor value chain, ETFs are also showing strong interest. On the previous day, Samsung Asset Management announced it would remodel the KODEX AI Semiconductor ETF, the largest AI semiconductor-themed ETF in Korea. Through this remodeling, KODEX AI Semiconductor will change its name to ‘KODEX AI Semiconductor TOP2 Plus,’ expand the weighting of Samsung Electronics and SK hynix, and newly include Samsung Electro-Mechanics. A representative from Samsung Asset Management stated, “Samsung Electro-Mechanics is now regarded as a key pillar in the AI semiconductor value chain, moving beyond just a parts supplier, and is expected to play a crucial role in delivering excess returns for the ETF in the future.”

Mirae Asset Global Investments has also newly included Samsung Electro-Mechanics and SK Square in its ‘TIGER Semiconductor TOP2 Covered Call Active’ ETF during the regular May rebalancing. A representative from Mirae Asset Global Investments noted, “With the inclusion of Samsung Electro-Mechanics and SK Square, the number of constituent stocks in the TIGER Semiconductor TOP2 Covered Call Active ETF has increased from 10 to 12. Through SK Square, we have strengthened indirect exposure to memory semiconductors, and through Samsung Electro-Mechanics, we have captured the benefits from MLCCs and packaging substrates for AI servers. By expanding the investment scope across the semiconductor value chain, we have enhanced our ability to capture future growth.”

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