As a result of the sharp decline in the KOSPI index, the market capitalization of South Korea's top 10 conglomerates has evaporated by over 1,100 trillion won this month. Concerns over profitability in the artificial intelligence (AI) value chain and weakness in shipbuilding and defense stocks have particularly impacted SK Group, HD Hyundai, and Samsung Group.
According to the Korea Exchange and financial information provider FnGuide, as of October 23, the combined market capitalization of the top 10 conglomerates was approximately 3,371.44 trillion won. This marks a decrease of about 1,101 trillion won compared to the end of last month, when it stood at around 4,472.53 trillion won.
The KOSPI has dropped 18.8% this month, leading to a decline in market capitalization across all top 10 groups. SK Group experienced the largest decrease, with its market capitalization plummeting by 30.1% from 1,563 trillion won at the end of last month to 1,093 trillion won recently.
The significant drop in SK Group's market value is attributed to the sharp decline in the stock prices of its major subsidiaries, SK Hynix and SK Square, due to concerns over AI value chain profitability. This month, SK Hynix's stock price fell by 28.1%, while SK Square's dropped by 32.0%, resulting in a combined market capitalization loss of 365 trillion won and 48 trillion won, respectively.
HD Hyundai Group's market capitalization decreased by 25.6%, from approximately 128 trillion won at the end of last month to 95 trillion won as of October 23. With five of its eight listed companies classified as shipbuilding stocks, the recent concerns over a peak-out in the shipbuilding industry have negatively affected their stock prices.
HD Hyundai's market capitalization fell from about 16 trillion won to 11 trillion won, a 32% decrease, while HD Hyundai Heavy Industries saw a 30% drop from approximately 46 trillion won to 32 trillion won.
Samsung Group's market capitalization decreased by 24.3%, from 2,161 trillion won to 1,636 trillion won, marking the third-largest decline. This drop was significantly influenced by the poor performance of semiconductor stocks, with Samsung Electronics' market capitalization falling from 1,570 trillion won to 1,260 trillion won, a 19.6% decrease.
Hanwha Group, which has a high proportion of export-oriented companies in shipbuilding and defense, also saw its market capitalization decline by 19.3%, from approximately 120 trillion won to 97 trillion won, making it the fourth-largest decrease. The recent strengthening of the won has raised concerns about the revenue and profitability of export companies, putting pressure on their stock prices.
Hanwha Engine's market capitalization dropped from about 4.1 trillion won to 2.7 trillion won, a 34.2% decrease, while Hanwha Ocean fell from approximately 24 trillion won to 17 trillion won, a 30% decline. The group's leading stock, Hanwha Aerospace, also saw its market capitalization decrease from about 52 trillion won to 41 trillion won, a 21.4% drop.
In contrast, LG Group's market capitalization only decreased by 5.3%, from 190 trillion won to 180 trillion won. This resilience is attributed to a 7.3% increase in the stock price of its leading subsidiary, LG Energy Solution, driven by rising demand for AI data centers in the U.S., highlighting growth potential in the energy storage system (ESS) market.
POSCO Group's market capitalization fell by 6.4%, from approximately 540 trillion won to 505 trillion won, reflecting a relatively lower decline. Additionally, GS Group's market capitalization decreased by 13%, from about 19 trillion won to 16 trillion won, while Shinsegae Group saw a 12% drop from approximately 6 trillion won to 5.3 trillion won. Hyundai Motor Group's market capitalization fell by 15%, from about 215 trillion won to 182 trillion won, and Lotte Group's market capitalization decreased by 4.3%, from approximately 17 trillion won to 16 trillion won.
According to the Korea Exchange and financial information provider FnGuide, as of October 23, the combined market capitalization of the top 10 conglomerates was approximately 3,371.44 trillion won. This marks a decrease of about 1,101 trillion won compared to the end of last month, when it stood at around 4,472.53 trillion won.
The KOSPI has dropped 18.8% this month, leading to a decline in market capitalization across all top 10 groups. SK Group experienced the largest decrease, with its market capitalization plummeting by 30.1% from 1,563 trillion won at the end of last month to 1,093 trillion won recently.
The significant drop in SK Group's market value is attributed to the sharp decline in the stock prices of its major subsidiaries, SK Hynix and SK Square, due to concerns over AI value chain profitability. This month, SK Hynix's stock price fell by 28.1%, while SK Square's dropped by 32.0%, resulting in a combined market capitalization loss of 365 trillion won and 48 trillion won, respectively.
HD Hyundai Group's market capitalization decreased by 25.6%, from approximately 128 trillion won at the end of last month to 95 trillion won as of October 23. With five of its eight listed companies classified as shipbuilding stocks, the recent concerns over a peak-out in the shipbuilding industry have negatively affected their stock prices.
HD Hyundai's market capitalization fell from about 16 trillion won to 11 trillion won, a 32% decrease, while HD Hyundai Heavy Industries saw a 30% drop from approximately 46 trillion won to 32 trillion won.
Samsung Group's market capitalization decreased by 24.3%, from 2,161 trillion won to 1,636 trillion won, marking the third-largest decline. This drop was significantly influenced by the poor performance of semiconductor stocks, with Samsung Electronics' market capitalization falling from 1,570 trillion won to 1,260 trillion won, a 19.6% decrease.
Hanwha Group, which has a high proportion of export-oriented companies in shipbuilding and defense, also saw its market capitalization decline by 19.3%, from approximately 120 trillion won to 97 trillion won, making it the fourth-largest decrease. The recent strengthening of the won has raised concerns about the revenue and profitability of export companies, putting pressure on their stock prices.
Hanwha Engine's market capitalization dropped from about 4.1 trillion won to 2.7 trillion won, a 34.2% decrease, while Hanwha Ocean fell from approximately 24 trillion won to 17 trillion won, a 30% decline. The group's leading stock, Hanwha Aerospace, also saw its market capitalization decrease from about 52 trillion won to 41 trillion won, a 21.4% drop.
In contrast, LG Group's market capitalization only decreased by 5.3%, from 190 trillion won to 180 trillion won. This resilience is attributed to a 7.3% increase in the stock price of its leading subsidiary, LG Energy Solution, driven by rising demand for AI data centers in the U.S., highlighting growth potential in the energy storage system (ESS) market.
POSCO Group's market capitalization fell by 6.4%, from approximately 540 trillion won to 505 trillion won, reflecting a relatively lower decline. Additionally, GS Group's market capitalization decreased by 13%, from about 19 trillion won to 16 trillion won, while Shinsegae Group saw a 12% drop from approximately 6 trillion won to 5.3 trillion won. Hyundai Motor Group's market capitalization fell by 15%, from about 215 trillion won to 182 trillion won, and Lotte Group's market capitalization decreased by 4.3%, from approximately 17 trillion won to 16 trillion won.
* This article has been translated by AI.
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