Kiwoom Asset Management is launching a group-stock exchange-traded fund that invests in Samsung Electronics (005930.KS) and SK hynix (000660.KS) alongside affiliates holding stakes in them, including Samsung Life Insurance (032830.KS), Samsung C&T (028260.KS) and SK Square (402340.KS). The structure targets not only growth in the semiconductor industry but also a revaluation of affiliate stakes driven by expanded shareholder returns.
Kiwoom Asset Management said on the 31st that it will list the KIWOOM Samsung SK Group TOP4+ ETF on the main board next month on the 1st. The product tracks the Akros Samsung SK Group TOP4+ Index and takes concentrated positions in 10 core affiliates of the Samsung and SK groups. Each June, the fund selects the core business sectors of each group, then analyzes divisional revenue at each affiliate to determine which stocks to include. The top two stocks in each group receive weightings of 25% and 15%, while the remaining six stocks are allocated up to 10% each based on free-float market capitalization.
The portfolio is built around three segments. It first assigns the largest weightings to Samsung Electronics and SK hynix, the groups' core semiconductor companies. It then adds Samsung C&T, Samsung Life Insurance, SK and SK Square, which hold stakes in those two companies. Finally, it includes Samsung Electro-Mechanics (009150.KS), Samsung E&A (028050.KS), SKC (011790.KS) and ISC (095340.KQ), all part of the artificial intelligence chip value chain.
A distinguishing feature is that recent moves by Samsung Electronics and SK hynix to strengthen shareholder returns have widened the range of beneficiaries to include affiliates holding their shares. Samsung Life Insurance and Samsung C&T, which own Samsung Electronics shares, can expect cash inflows from larger dividends, while SK Square and its parent SK, which hold SK hynix shares, stand to benefit from a revaluation of those stakes following share buybacks and cancellations, the company said.
Affiliates expected to benefit from the expanding AI server market are also drawing continued investor interest. Samsung Electro-Mechanics makes multilayer ceramic capacitors and flip-chip ball grid array substrates, high-value products used in AI servers, while SKC runs a glass substrate business for semiconductors. The fund also includes ISC, a maker of semiconductor test sockets, extending its scope beyond memory chips to AI server components and equipment.
"With this product, we wanted to capture how the gains from semiconductor growth spread to affiliates through ownership structures," said Lee Kyung-joon, head of the ETF management division at Kiwoom Asset Management. "It can offer a new option for investors looking to ride the trend in which leading chipmakers and the companies holding their shares are revalued together."
