Jeong Eun-bo, chairman of South Korea’s Korea Exchange (KRX), says the current concentration of the stock market in semiconductors is “natural,” driven by a price-setting process reflecting supply and demand and other economic factors. Speaking Monday to foreign media in Seoul, he links the market’s dominance to the strength of major chipmakers, including Samsung Electronics and SK hynix, whose operating performance plays a role in how the market values the sector.
His remarks come as some observers express concern about potential volatility in South Korea’s market, noting that the combined market capitalization of Samsung and SK hynix has grown to account for more than half of the total value of companies listed on the benchmark KOSPI index. Jeong also compared valuation metrics, saying the price-to-earnings ratio (PER) for Samsung and SK hynix, based on expected revenue, is around the high single digits (about 7 to 8), while Micron Technology’s PER is above 10.
Jeong adds that it is too early to judge whether the current semiconductor rally is speculation, and says the government is working to “smooth out” market swings while improving foreign investors’ access.
