KOSPI Nears 7,400 as Analysts See Room for 8,000 to 9,000 on AI, Chip Boom

 
The KOSPI’s ceiling appeared to give way as the benchmark surged to just below 7,400. The index was up nearly 450 points from the previous session, extending a rally that has accelerated since it closed above 6,000 on Feb. 25. That move came about 50 trading days ago.
Despite headwinds cited by the market — war in the Middle East, a weakening real economy and concerns about an AI bubble — brokerage research chiefs said the rally could continue into the second half, with some projecting the KOSPI could move beyond 8,000 and even approach 9,000.
  On the 6th, Ajou Economy conducted an emergency survey of research heads at seven brokerages: Korea Investment & Securities, NH Investment & Securities, Samsung Securities, Kiwoom Securities, Shinyoung Securities, Yuanta Securities and SangSangIn Securities. Several respondents said further upward revisions were likely, and some said a top-end scenario could reach 9,000.
 
Choi Hyun-jae, head of research at Yuanta Securities, said, “Under the best-case scenario, there is room up to 8,100,” adding, “In terms of market capitalization, above 9,000 is also possible.”
Yoon Seok-mo, head of research at Samsung Securities, said he raised his previous annual band top to 8,400 from 7,200, based on “a 12-month expected ROE of 19.6% and an appropriate P/B of 2.2 times.”
Baek Young-chan, head of research at SangSangIn Securities, said he plans to raise his forecast from 7,540 and that 8,000 is possible, citing profit growth at Samsung Electronics and SK hynix as “the key driver.”
 
Others said they also need to revisit forecasts after the unprecedented run-up. Lee Jong-hyeong, head of research at Kiwoom Securities, said that while the firm previously suggested a 5,200 to 7,300 range, “given the current price level and earnings momentum, an upward revision is needed,” adding that a trend in which semiconductor demand overwhelms supply “will continue for some time.”
Yoo Jong-woo, head of research at Korea Investment & Securities, said the firm is presenting 7,250 as the upper end but could raise it further in the second half, explaining that rising EPS is driving the index higher.
 
Kim Hak-kyun, head of research at Shinyoung Securities, said it is difficult to set a ceiling and argued the market remains undervalued. “This is a phase where the power of semiconductors is showing up dramatically,” he said, adding that the market is hard to view as a bubble. He said Samsung Electronics and SK hynix are trading at about six times earnings, while the overall KOSPI is below eight times. Kim said it is better to keep an open mind “until upward revisions to earnings estimates start to fade.”
  Research chiefs broadly pointed to AI and semiconductors as the main reasons they expect the rally to persist. They said the KOSPI is in a phase of restructuring its earnings base around AI and chips, prompting a reassessment of index levels.
 
Cho Soo-hong, head of research at NH Investment & Securities, said, “More than the number itself, the AI cycle is key,” adding that the semiconductor industry is being reshaped from consumer-led demand to infrastructure-led demand.
Choi said that next year Samsung Electronics could post the largest profit in the global semiconductor industry, adding that a profit structure “similar to Nvidia’s, or even higher,” is possible.
Baek said the second-half outlook should consider conditions and Middle East variables, but added that next year the index could reach the mid-8,000s.
 
For the second half, most respondents said leadership is likely to remain concentrated in the AI value chain centered on semiconductors. Some also cited brokerage and defense sectors as potential gainers.
Lee said the AI value chain, along with power equipment, brokerages and defense, would lead. Choi said earnings estimates are barely rising outside semiconductors and IT, adding, “In a major uptrend, market leadership does not change.” He also cited power equipment, nuclear power and materials tied to data centers.
 
Yoo said industrials such as energy, power machinery and robots, along with the AI value chain, are key. Yoon said that with global liquidity expanding, Samsung Securities is maintaining a preference for the AI value chain — including semiconductors, power equipment, nuclear power and robots — and also holds a positive view on industrials and financials.
 
Baek cited solar power, secondary batteries, brokerages, construction and optical communications and fiber as leading groups. Cho said the rally is spreading from semiconductors to AI infrastructure, power equipment, nuclear power, defense and brokerages.