Last year, SK hynix led the KOSPI market. Investors left out of the stock's sharp rally turned their attention to the intermediate holding company SK Square as an alternative. Fueled by anticipation of a governance overhaul and heavy institutional buying, it delivered an "overwhelming return" that outpaced SK hynix. While some warn the stock is already at its peak, brokerages are still betting on "further gains."
According to the Korea Exchange (KRX) on the 8th, on the 7th SK hynix closed at 742,000 won, up 16,000 won (2.2%) from the previous trading day. Powered by the stock's surge, as of the 6th its market capitalization hit a record 528 trillion won, even surpassing the entire KOSDAQ market cap.
SK hynix delivered a dazzling return in 2025. As the memory cycle triggered by artificial intelligence (AI) took off in earnest, competitiveness in high bandwidth memory (HBM) came to the fore. In fact, the share price soared from 171,200 won at the start of the year to 651,000 won at year's end, achieving an annual return of 280%.
As this equity value was reflected, the intermediate holding company SK Square also jumped. SK Square holds about a 20% equity stake in SK hynix, as well as SK Planet, T Map Mobility, and ONE store. Last year, SK Square's share price rose from 78,600 won at the start of the year to 368,000 won at the end, a gain of 368%.
Behind SK Square's greater share-price elasticity was not only higher equity value but also concentrated buying by financial investment firms. Ahn Jae-min, a researcher at NH Investment & Securities, said, "While SK Square's share price is bound to be linked to SK hynix's trajectory, as collective investment managers keep a strategy of expanding SK hynix's weight, it will lead to the choice of relatively increasing SK Square's weight."
In November last year, the Korea Financial Investment Association eased rules so that collective investment managers could hold SK hynix in proportion to its market cap weight. Previously, under the Financial Investment Services and Capital Markets Act, a 10% single-stock investment cap applied, but the allowance expanded to the market cap weight. Given SK hynix's KOSPI market cap weight was 14% as of the 6th, there is a strong case that funds seeking to raise portfolio weights will flow into SK Square.
Actual supply-demand trends back this up. Financial investment and investment trusts, which reflect collective investment managers' fund flows, made net purchases of SK Square in November last year of 20.3 billion won and 67 billion won, respectively, for a total of 87.3 billion won. In December, they also net bought a total of 110 billion won, including 97.4 billion won by financial investment and 12.6 billion won by investment trusts. Compared with the October net purchase size (38.8 billion won), this was a sharp increase.
Although the holding company's stock rose more steeply than SK hynix, the securities industry still says SK Square's mid- to long-term growth momentum merits attention. That is because expectations for changes in the governance structure and expanded shareholder returns are working in tandem.
SK Square recently moved to streamline loss-making subsidiaries. It transferred 11Street, as well as SparkPlus, Korbit, and Green Labs, to its subsidiary SK Planet, focusing on "trimming the fat." Incross, which operates advertising and commerce businesses, transferred equity to SK Networks, and Dreamus Company also transferred equity to beNX, moving to slim down the organization.
After the rebalancing, investments in AI and semiconductors are expected to ramp up in earnest. To that end, SK Square carried out an organizational overhaul this year, reorganizing the existing CIO and portfolio management units into the Strategic Investment Center (SIC). In addition, Senior Vice Chairman Choi Jae-won of SK Innovation joined SK Square as senior vice chairman, bolstering the investment strategy.
Choi, the senior vice chairman, began his career at SKC in 1994 and is regarded as one of the group's leading global experts, having worked at SK Telecom, SK E&S, and SK Networks. The market is focusing on the possibility that, with his arrival, SK Square will pursue more aggressive mergers and acquisitions (M&A) in AI and semiconductors on the back of its accumulated cash.
Expectations for expanded shareholder returns are also cited as a driver of share-price strength. SK Square decided to acquire an additional 100 billion won in treasury shares by Feb. 2026. There is also talk it may use cash secured through the liquidation of subsidiaries as a resource for dividends.
Kim Jang-won, a researcher at BNK Investment & Securities, said, "With the rise in the value of the equity stake in SK hynix and buying that factors in the controlling shareholder's power, the direct and indirect investment elements are positive, so investment appeal continues to grow," setting a target price of 550,000 won.