ETF Launches Targeting 'Up to 300 Trillion Won' Shareholder Returns from Samsung and SK hynix

"KIWOOM Samsung SK Group TOP4+" Set for Listing
Group Stocks Holding Stakes in Top 4 Including Samsung and SK hynix
Large-Scale Shareholder Returns Expected to Drive Stake Revaluation

An exchange-traded fund (ETF) has emerged targeting the shareholder return benefits of Samsung Electronics and SK hynix, which are estimated to reach up to 300 trillion won. By incorporating a large number of companies holding stakes in both "Samsung and SK hynix," this ETF utilizes a strategy to maximize gains and stock price appreciation tied to shareholder return programs.

According to the financial investment industry on August 21, Kiwoom Asset Management plans to list the "KIWOOM Samsung SK Group TOP4+" ETF as a new product on September 1. The expense ratio is set at an annual 0.45%.

This ETF will include Samsung Electronics, SK hynix, Samsung Electro-Mechanics, and SK Square as the "Top 4" stocks, and will also incorporate stocks such as Samsung C&T, Samsung Life Insurance, and SK, all of which hold stakes in Samsung Electronics and SK hynix. Samsung C&T holds about 5.1% of Samsung Electronics shares, while Samsung Life Insurance owns about 8.5%. SK Square is the largest shareholder of SK hynix, with a stake of 20.5%, and the holding company SK possesses 32.2% of SK Square shares.

With this structure, the ETF is expected to benefit directly from the recently announced large-scale shareholder return programs of Samsung Electronics and SK hynix, setting it apart from typical semiconductor ETFs. It is analyzed that special dividends from Samsung Electronics will flow to Samsung Life Insurance and Samsung C&T, laying the foundation for improvements in both corporate value and stake valuation. SK hynix's cancellation of its treasury shares is also expected to lead to a revaluation of SK Square's stake in the company.

KB Securities estimates that Samsung Electronics' annual shareholder return could reach between 100 trillion and 200 trillion won. Based on cash dividends, the dividend yield is estimated at about 7–15%. On August 19, SK hynix announced it would buy and cancel 40 trillion won worth of treasury shares in full. In addition, the company raised its shareholder return ratio of free cash flow (FCF) over three years from "within 50%" to "over 50%." The industry estimates the total shareholder return size at about 100 trillion won. Younggon Lee, a researcher at Toss Securities, explained, "If the artificial intelligence (AI) memory boom continues, the cumulative three-year FCF could surpass 250–300 trillion won by 2027. Even if only half of that FCF is returned, a significant amount of cash will flow back to shareholders."

Additionally, if the stock prices of Samsung Electronics and SK hynix rise, the valuation of shares held by Samsung Life Insurance, SK Square, and others is also expected to increase. In fact, the share prices of both companies and their major shareholders have shown similar movements recently. Following the announcement of shareholder return plans, the stock price of SK hynix surged by 12.73% on August 20, with SK Square rising 11.85% on the same day. Meanwhile, Samsung Electronics rose 9.49%, and Samsung C&T gained 7.78%.

An official from Kiwoom Asset Management stated, "Most semiconductor ETFs include not only Samsung Electronics, SK hynix, and Samsung Electro-Mechanics, but also various semiconductor materials, components, and equipment makers. In contrast, this product is composed solely of subsidiaries within the Samsung Group and SK Group," adding, "It is a product designed to consider both the stock price appreciation of Samsung Electronics and SK hynix and also the shareholder return benefits that are maximized via group shareholding structures."

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