Foreign Investors Sell Samsung Electronics Despite Record-Breaking Earnings; Foreign Ownership at Lowest Since Financial Crisis

[Financial News] Foreign ownership of Samsung Electronics has fallen to its lowest level since the financial crisis. Despite the company posting record-breaking earnings, foreign investors appear to be continuing to sell.
According to the Korea Exchange on the 11th, foreign ownership of Samsung Electronics stood at 46.38% as of the 8th. After falling to 46.37% on the 7th, it has remained at a low level.
That is a sharp drop of about 6 percentage points from 52.33% at the start of this year, and the lowest level since July 2009, immediately after the global financial crisis.
Foreign investors have continued selling even after Samsung Electronics announced a large-scale shareholder return plan and then reported record-breaking earnings.
Foreign investors have been net sellers of Samsung Electronics shares worth 85.5017 trillion won so far this year through the 8th. After net selling 4.8922 trillion won last month, they were net sellers by 1.2389 trillion won from the start of this month through the 8th.
Foreign ownership of SK hynix has also fallen below half. As of the 8th, foreign investors held 49.59%, down at least 5 percentage points from 54.64% at the start of the year. Their net selling of SK hynix shares so far this year through the 8th totaled 86.14 trillion won.
Lee Jae-won, a researcher at Yuanta Securities, said, “Despite robust industry conditions and earnings prospects, foreign ownership of Samsung Electronics and SK hynix is declining. Foreign investors are engaging in large-scale net selling, widening the gap between fundamentals and supply-and-demand dynamics.”
He added, “We believe recent foreign outflows from semiconductor stocks have been driven more by the higher discount rate applied to the Korean stock market amid high interest rates and high oil prices, and by weaker risk appetite, than by a slowdown in industry conditions. As the deterioration in industry conditions is limited, investors should watch for the possibility of supply-and-demand conditions normalizing after interest rates normalize and earnings are announced.”

[email protected] Seo Min-ji Reporter