KOSPI Hits Circuit-Breaker! JPMorgan Targets 10,000: SK Hynix and Samsung are Better Choices?

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$KOSPI$ surged more than 5% intraday today, triggering a circuit breaker.

SK Hynix jumped +12% to above ₩1.89M, +185% YTD. Samsung rose +6%, crossing the $1 trillion market cap threshold, +139% YTD.

JPMorgan's latest strategy report names Korea its top pick in Asia-Pacific, raising the KOSPI target to 9,000 (base) / 10,000 (bull).

KOSPI has hit 77 all-time highs this year. Korea's MSCI EM weight has risen to >21%, nearly matching China at 22%.

AI arms race: Global AI compute expansion is bottlenecked at HBM (High Bandwidth Memory). SK Hynix is the world's dominant HBM4 supplier — full-year capacity is sold out, customers are already pre-booking 2027 supply. Samsung HBM is equally constrained.

Historic earnings: Samsung Q1 2026 operating profit: ₩57.2 trillion, +750% YoY — one quarter exceeding all of last year. SK Hynix net profit +400% YoY. JPMorgan forecasts storage sector 2026 EPS at roughly 5x the 2025 level.

"Korea discount" unwinding: Korea's government launched a Corporate Value-Up program — mandatory treasury stock cancellations, dividend tax incentives, removal of foreign investment restrictions. The structural valuation discount is being systematically closed.

Apple + Physical AI: Apple is reportedly in talks for Samsung's US fab to manufacture Apple main processors. NVIDIA's robotics and autonomous driving expansion has Samsung and Hynix deeply embedded as hardware suppliers.

Why JPMorgan Says "Far From Peak"?

Storage stocks are already 50% of KOSPI's weight and contributed ~70% of YTD gains. Sounds dangerously concentrated? JPMorgan disagrees:

HBM TAM is accelerating: 2026E $65.7B → 2027E $109.9B → 2028E $185.7B (YoY +69%). Supply is locked in multi-quarter pricing agreements. The volume + price expansion story extends through 2027-2028.

AI monetization bottleneck clearing: Global token consumption growth jumped from 10x to >15x YoY, driven by agentic AI adoption. Upstream hardware pricing power continues to strengthen.

Valuations remain cheap: Samsung trades at a forward P/E of 6.1, SK Hynix at 5.6 — significant discount to US semiconductor peers.

What Are the Risks?

Concentration cuts both ways: storage at 50% of KOSPI means any HBM demand miss hits the entire index.

Tech sector EPS has been revised +278.5% over six months — expectations are already rich. Any quarterly miss triggers outsized volatility.

Geopolitical exposure: Korea's export structure is deeply tied to both the US and China, making trade policy and supply chain realignment an ongoing variable.

How to Get Exposure?

-2x leverage: $CSOP SK Hynix Daily (2x) Leveraged Product(07709)$ , $CSOP Samsung Electronics Daily (2x) Leveraged Product(07747)$

- ETF: $iShares MSCI South Korea ETF(EWY)$ (iShares MSCI South Korea ETF — Samsung + Hynix ~40% combined weight)

Have You Participated in the Korea Rally?

SK Hynix +185%, Samsung +139% YTD — at forward P/E of 5-6x, do you think these are still cheap for where we are in the AI cycle, or has the EPS outlook already been fully priced in?

JPMorgan targets KOSPI 10,000 from the current ~8,000 — a 25% move. Do you prefer direct Korean equity/ETF exposure, or playing the HBM cycle through $Micron Technology(MU)$/ $SanDisk Corp.(SNDK)$?

HBM supply constraints are forecast to last through 2027-2028. What's your biggest concern — an unexpected slowdown in AI capex, or something else?

Leave your comments to win tiger coins!

JPMorgan Targets KOSPI 10,000: SK Hynix and Samsung are Better Choices?

$KOSPI$ surged more than 5% intraday today, triggering a circuit breaker. JPMorgan's latest strategy report names Korea its top pick in Asia-Pacific, raising the KOSPI target to 9,000 (base) / 10,000 (bull). Have You Participated in the Korea Rally? Do you think these are still cheap for where we are in the AI cycle, or has the EPS outlook already been fully priced in? Do you prefer direct Korean equity/ETF exposure, or playing the HBM cycle through $MU$/$SNDK$? What's your biggest concern — an unexpected slowdown in AI capex, or something else?

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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Comments

TimothyX
05-11 21:29
TimothyX
$KOSPI$ surged more than 5% intraday today, triggering a circuit breaker.

SK Hynix jumped +12% to above ₩1.89M, +185% YTD. Samsung rose +6%, crossing the $1 trillion market cap threshold, +139% YTD.

JPMorgan's latest strategy report names Korea its top pick in Asia-Pacific, raising the KOSPI target to 9,000 (base) / 10,000 (bull).
Shyon
05-11 22:00
Shyon
I’m paying much closer attention to Korea this year because the setup feels very different from past chip cycles. AI-driven HBM shortages, multi-year supply lock-ins, and the “Korea discount” unwinding are creating both earnings growth and valuation expansion together. Even after the rally, Samsung and SK Hynix still don’t look expensive to me at around 5-6x forward earnings while sitting at the center of the AI infrastructure boom.

Personally, I prefer a mix of direct semiconductor exposure & $iShares MSCI South Korea ETF(EWY)exposure. SK Hynix has the strongest HBM positioning, but Korea as a whole may still be in the early stages of rerating compared with expensive US AI names.

My biggest concern is not AI demand slowing, but expectations getting too far ahead. If capacity expands too aggressively into 2027-2028, the market could start pricing in oversupply risks. But for now, earnings momentum and pricing power still look very strong.

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Chrishust
04:40
Chrishust
$KOSPI 200 Index(KOSPI200.KR)$ Korea index is driven by the importance of future technologies which is an investment in the electronics and products of Samsung. $SAMSUNG SEMICON(03132)$ high quality company with stable revenue and outlook
北极篂
05-11 22:06
北极篂
如果是我，我会偏向ETF而不是2倍杠杆。因为这类行情后期震荡通常非常夸张，ETF至少还能吃到韩国整体估值修复，而不是纯赌单一HBM周期。
這是甚麼東西
09:24
這是甚麼東西
Primary Risks and ConcernsThe biggest concern is not a Capex slowdown, but "HBM4 execution risk." As the industry moves to the next generation of memory, the technical difficulty increases exponentially. If yields drop significantly during the transition to HBM4, the projected profit margins will erode regardless of demand. A secondary concern is "China's legacy capacity," which could eventually pivot to lower-end AI chips and disrupt the broader supply-demand equilibrium.
這是甚麼東西
09:24
這是甚麼東西
Korean Equity vs. US ProxiesDirect Korean exposure is the superior play. While Micron ($MU$) is a strong contender, SK Hynix and Samsung offer a "valuation catch-up" trade that US peers lack. The KOSPI is benefiting from specific "Value-Up" regulatory reforms and potential ADR listings that could re-rate these stocks to higher global standards. Buying the source of HBM production at a discount is more efficient than paying the "US liquidity premium" for Micron.