Was 110 Trillion Won Not Enough? Samsung Electronics Plunges, Dragging Down KOSPI

Morgan Stanley: "Samsung Electronics' Shareholder Return Falls Short of Market Expectations"

Samsung Electronics Plunges Over 6% During Trading; KOSPI Drops More Than 1%

Nvidia's Quarterly Results on the 27th Set to Be a Watershed for Semico

On the 24th, employees were monitoring the stock market and exchange rates in the dealing room at the headquarters of Hana Bank in Jung-gu, Seoul. On that day, the KOSPI opened at 6881.07, down 31.88 points (0.46%) from the previous trading day, while the KOSDAQ started the session at 804.27, up 2.33 points (0.29%). August 24, 2026 Photo by Cho Yongjun

Despite Samsung Electronics unveiling a shareholder return plan worth 110 trillion won—the largest in Korean corporate history—its stock price fell, dragging down the KOSPI. The evaluation is that the scale and content of the shareholder return plan did not meet the market’s elevated expectations. However, some analysts believe that, from a medium- to long-term perspective, shareholder returns worth several hundred trillion won, to be carried out with SK hynix, will provide strong downside support for the domestic stock market.

Despite Samsung Electronics’ Massive Shareholder Return, Stock Price Falls Over 6%

On August 24, the KOSPI opened at 6,881.07, down 0.46% from the previous trading day, and extended its losses to 6,831.52 as of 10:06 a.m., down 1.18%. In contrast, the KOSDAQ is trading up 2.21% at 820.01.

The KOSPI dropped as shares of market giant Samsung Electronics plummeted. As of 10:07 a.m., Samsung Electronics is trading at 263,000 won, down 6.57% from the previous session. Related companies that hold large stakes in Samsung Electronics, such as Samsung Life Insurance (-9.13%) and Samsung C&T (-7.84%), are also experiencing sharp declines. On August 21, Samsung Electronics announced at a board meeting its plan to carry out shareholder returns of between 90 trillion and 110 trillion won this year. This is about five times larger than its previous record return of 20.3 trillion won in 2020. Samsung plans to first execute a cash dividend totaling around 30 trillion won, including the regular third-quarter dividend payment.

Although Samsung Electronics has unveiled the largest shareholder return plan ever by a Korean company, the market’s response was negative as it fell short of expectations. Previously, KB Securities projected that Samsung Electronics’ shareholder return this year could reach as much as 200 trillion won, and the market generally expected a return exceeding 110 trillion won. Global investment bank Morgan Stanley commented, “Given that the market’s expectations for Samsung Electronics’ shareholder return surpassed 110 trillion won, the actual announcement fell slightly short of expectations.”

In particular, investor sentiment has taken a hit because the immediately confirmed return is limited to about 30 trillion won in cash dividends, while plans for the use of the remaining resources have been postponed until next year. Samsung Electronics stated that the usage plan for the remaining 60-80 trillion won will be decided at the board meeting next January, after the confirmation of its 2026 business performance. JPMorgan pointed out, “While the total shareholder return is consistent with the previous top expectation of 110 trillion won, the 30 trillion won to be distributed immediately in the third quarter accounts for only about 25% of operating cash flow in the first half. Even compared to the ‘50% of FCF’ rule, this is still lower than market expectations.”

In contrast, SK hynix’s shareholder return plan has exceeded market expectations, with the share price up 1.45% at 1,755,000 won as of 10:08 a.m. SK hynix announced on August 19 that it plans to buy back and cancel treasury shares worth 40 trillion won. The company also announced a new shareholder return policy to return more than 50% of its free cash flow (FCF) over three years. Following this, the company’s share price rose more than 10%, and the market response has been positive.

Lee Jongwook, a researcher at Samsung Securities, stated, “SK hynix has raised its shareholder return target from up to 50% of cumulative FCF to more than 50%. This shareholder return plan is a signal from management regarding the sustainability of profits and serves as a catalyst that highlights the stock’s growth potential.”

“Hundreds of Trillions in Shareholder Returns From Both Companies Will Support KOSPI Downside”

After both companies revealed their shareholder return plans, stock price volatility has increased in the short term; however, analysts expect these moves to provide downside support for the market in the medium term. Han Ji-young, a researcher at Kiwoom Securities, commented, “After Samsung Electronics announced its shareholder return plan, there was increased market volatility; nevertheless, it is important to note that, from a mid-term perspective, the structure that converts cash generated from profit growth into shareholder value has been further strengthened. Together with SK hynix, these measures are expected to serve as a liquidity safety net for Korea’s stock market as a whole.”

The upcoming second-quarter earnings release of Nvidia, scheduled for August 27 Korea time, is cited as a key variable for semiconductor stocks. Han added, “Nvidia’s earnings will be the main event that sets the direction for the market, potentially even into next week. Given Nvidia’s leadership among key stocks, whether its second-quarter results and guidance exceed consensus will remain an important issue.”

Meanwhile, as of 10:13 a.m., other major large-cap stocks like SK Square (-1.78%), Hyundai Motor (-0.24%), and Samsung Biologics (-0.19%) are trading lower, while Samsung Electro-Mechanics (1.75%), LG Energy Solution (3.64%), Hanwha Aerospace (3.04%), and HD Hyundai Heavy Industries (0.77%) are showing strength. By sector, insurance (-5.00%), retail (-4.10%), and electrical & electronics (-3.01%) are seeing steep declines, while entertainment & culture (1.71%), general services (1.52%), and food, beverage & tobacco (1.11%) are rising. On the KOSPI, foreign investors are net sellers of around 1.2 trillion won, institutional investors are net sellers of 310 billion won, and only individual investors are net buyers of more than 1.2 trillion won.

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