Kospi Profit Outlook Raised Again as Chip Boom Fuels 10,000 Call

Listed companies’ earnings outlook gets another lift

Samsung Electronics, SK Hynix to account for 73% of next year’s profit; 2026 forecast raised to $612.4 billion

Global banks see a multiyear hypercycle; JPMorgan sets 10,000 Kospi target

South Korea’s benchmark stock index could top 10,000 as operating profit at Kospi-listed companies is forecast to exceed 800 trillion won this year, driven by steadily rising earnings estimates for Samsung Electronics Co. and SK Hynix Inc. Investors are increasingly betting that the AI-driven semiconductor supercycle will stretch into a multiyear hypercycle.

FnGuide, a Korean financial data provider, said May 11 that consensus forecasts for this year’s operating profit at 170 Kospi-listed companies with estimates from at least three brokerages totaled 849.5262 trillion won, or about $612.4 billion, on a consolidated basis. That is up 25% from 676.8813 trillion won a month earlier. The forecast for next year stands at 1,050.2303 trillion won, 23.6% above this year’s estimate and 287.1% higher than last year’s finalized 271.2698 trillion won.

The biggest driver of those upward revisions is South Korea’s two leading chipmakers, Samsung Electronics and SK Hynix. Earnings estimates for both companies have risen as average selling prices for memory chips continue to climb and the companies sign long-term supply agreements. Brokerages now project their combined operating profit at 587.6624 trillion won this year and 768.5790 trillion won next year, equivalent to 69% of total projected profit this year and 73% next year.

The upgrades have come so quickly that valuations have fallen despite the sharp rally in the shares. Over the past three months, combined operating profit estimates for the two companies have jumped 90.4%, outpacing a 70.1% gain in Samsung Electronics shares over the same period. Their 12-month forward price-to-earnings ratios are 5.8 times for Samsung Electronics and 5.1 times for SK Hynix.

Global investment banks expect the chip upcycle to last for years rather than peak this year. Goldman Sachs wrote in a May 8 report that Samsung Electronics’ operating profit could reach $344.5 billion in 2028. JPMorgan, in a Korea market strategy report published May 11, said memory-chip average selling prices and shipments would rise together through 2028 and set a 10,000 target for the Kospi.

The Kospi closed 4.32% higher at 7,822.24 on May 11, lifted by concentrated buying from retail investors. The index is now 178 points, or 2.27%, short of 8,000.

Jeon Beom-jin / Kang Jin-gyu, Hankyung.com reporters forward@hankyung.com