Samsung Electronics and SK Hynix are expected to conclude their share buyback programs soon, which have acted as a stabilizing force in the market. The two companies have executed 41.37 trillion won of their planned 55 trillion won in buybacks, while foreign and individual investors have sold over 39 trillion won in net sales during the same period. The end of these buybacks raises concerns about potential shifts in market dynamics.
According to the Korea Exchange, Samsung Electronics purchased 47.8 million shares from August 24 to September 28, with a total acquisition cost of 12.53 trillion won, utilizing 89.70% of the reported amount of 53.29 million shares. The total reported amount is approximately 15 trillion won. SK Hynix acquired 16.55 million shares during the same period, with a cumulative acquisition cost of 28.84 trillion won, covering 68.76% of the planned 24.07 million shares. The total reported amount for SK Hynix is about 40.04 trillion won. Together, the planned buybacks for both companies total approximately 55.04 trillion won, with about 75% executed by September 28.
Samsung Electronics has 5.49 million shares remaining. If it continues to buy 2 million shares daily, it could complete its buyback by October 1. SK Hynix has 7.52 million shares left, and if it maintains its current pace of 600,000 to 650,000 shares per day, it may finish its buyback by mid-October. The original end dates for the buybacks were November 21 for Samsung Electronics and November 19 for SK Hynix.
During the buyback period, investor activity varied significantly. Samsung Electronics saw foreign investors sell 5.87 trillion won and individual investors sell 7.47 trillion won. Similarly, SK Hynix experienced foreign sales of 13.72 trillion won and individual sales of 12.25 trillion won. The total net sales from foreign and individual investors for both companies reached 39.30 trillion won. In contrast, other corporations purchased 12.25 trillion won worth of Samsung Electronics shares and 28.50 trillion won worth of SK Hynix shares. Notably, the buyback by Samsung Electronics accounted for about 95.5% of total purchases by other corporations during this period, while SK Hynix's buyback represented approximately 97.2%.
Stock prices trended upward during the buyback period. Samsung Electronics' stock rose from 257,000 won on August 24 to 270,000 won on September 28, an increase of 5.1%. SK Hynix's stock also climbed from around 1,691,000 won at the start of the buyback to 1,768,000 won on September 28, a rise of about 4.6%.
As the buybacks conclude, changes in the supply-demand dynamics for Samsung Electronics and SK Hynix are anticipated. Despite significant net sales from foreign and individual investors during the buyback period, the buying pressure from other corporations, primarily driven by the buybacks, has absorbed much of this selling. With the buyback volume likely to be exhausted more than a month earlier than initially planned, the absence of this stabilizing buying force could lead to a deterioration in market conditions.
On this day, the KOSPI closed at 6,870.81, down 18.93 points (0.27%) from the previous trading day. Foreign investors sold a net 2.90 trillion won, while individuals and institutions bought a net 1.14 trillion won and 121.1 billion won, respectively. Samsung Electronics rose by 0.93%, while SK Hynix fell by 0.17%. The KOSDAQ finished at 849.80, up 0.38%.
* This article has been translated by AI.
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