Prime Highlights
- Memory chip prices doubled in the first quarter alone and are forecast to climb a further 63% in the current quarter, driven by AI data centre demand.
- South Korea became the first country outside the United States to have more than one company surpass $1 trillion in market value.
Key Facts
- SK Hynix is a South Korean semiconductor company and one of the world’s largest producers of memory chips, including high-bandwidth memory used in AI hardware.
- The KOSPI is South Korea’s benchmark stock index; it has risen 91% so far this year, making it the world’s best-performing major index during the ongoing AI-driven rally.
Background
South Korean chipmaker SK Hynix crossed $1 trillion in market value for the first time, joining rivals Samsung Electronics and Micron Technology in reaching the milestone. Shares of SK Hynix surged as much as 14.9%, pushing its market capitalisation to a record 1,680 trillion won, equivalent to $1.12 trillion.
The rally also lifted South Korea’s benchmark KOSPI index to an all-time high, rising as much as 5.09% to 8,457.09. Samsung and SK Hynix together accounted for half of the index by market value. The KOSPI has risen 91% so far this year, making it the world’s best-performing stock index during the current AI boom.
Samsung crossed the $1 trillion mark in the first week of May, while Micron reached it just a day earlier. South Korea became the first country outside the United States to have more than one company in the trillion-dollar club.
The surge is driven by soaring demand for high-end memory chips used in AI chipsets, particularly those designed by Nvidia. Memory chip prices doubled in the first quarter from the previous period and are forecast to rise a further 63% in the current quarter. Tighter supply across smartphones, laptops, and automobiles has helped top chipmakers post record profits.
An analyst at Mirae Asset Securities said memory chip demand is expected to continue outpacing supply through 2028, keeping prices elevated. The firm raised its target prices for SK Hynix and Samsung by 18.8% and 14.6%, respectively.
US retail investors have also poured billions into a new ETF offering exposure to Samsung and SK Hynix in recent weeks.