Samsung and SK Hynix Surge as Temasek Report Stirs Seoul Chip Rally

South Korea's two memory giants rallied hard on Wednesday after a report that Singapore's state investor Temasek plans to invest directly in both chipmakers, according to Yonhap and Bloomberg. The KOSPI jumped about 4.6 percent — at one point up 5.1 percent — with Samsung Electronics climbing as much as 8 percent and SK Hynix up to 8 percent, while LG Innotek rose nearly 9.5 percent.

A Sector Searching for Its Premium

The rally extends a rebound from July's sell-off in the AI memory trade. Investors have been pressuring both companies to return more cash during the boom, and valuations remain striking: Samsung and SK Hynix trade at just 4.2x and 3.6x forward earnings respectively, versus roughly 21x for the Philadelphia Semiconductor Index, Bloomberg reported Tuesday in a piece titled "Peak Memory Fears Put Focus on Samsung, SK Hynix Cash Returns."

Demand fundamentals behind the froth are strong. SK Hynix said on Friday it will invest 54 trillion won ($38.1 billion) to build two new memory fabs — Yongin Y2 and Cheongju M17 — targeting AI memory production capacity through the 2030s, one of the largest single-cycle HBM commitments on record. Micron's EVP said supply tightness in memory is expected to persist beyond 2027, with DRAM the primary constraint and 2027 supply-demand likely "even tighter" than 2026.

Government Signal, Not Yet a Deal

The Temasek report remains unconfirmed by either company. Analysts cautioned that a formal investment would be a political signal as much as a financial one, given Washington's push for domestic HBM fabs — the US currently has zero high-bandwidth memory wafer fabrication plants, a gap regulators have sought to close with CHIPS-related incentives. Neither Samsung nor SK Hynix had commented on the report as of Wednesday afternoon Seoul time, and shares gave back a slice of the gains by midday.