Samsung Biologics cements No. 3 in market cap ahead of SK hynix in Kospi

[Image source : Samsung Biologics]

Samsung Biologics has cemented its position as the third largest market-cap stock on South Korea’s main Kospi bourse with a gap of more than 2 trillion won ($1.50 billion) with SK hynix after elbowing out the country’s second largest memory chip maker early last week.

According to sources in brokerage firms on Tuesday, Samsung Biologics’ market value stood at 62.98 trillion won, ranking third on the Kospi, while SK hynix reached 60.93 trillion won. Samsung Electronics was solid No.1 with 361.76 trillion won in market cap, followed by LG Energy Solution (132.67 trillion won). LG Chem and Samsung SDI posted 50.47 trillion won, and 49.37 trillion won.

SK hynix and Samsung Biologics have been in a fierce rivalry to take third place. On Nov. 21, Samsung Biologics’ market cap reached 63.20 trillion won, beating SK hynix to become the third largest market-cap stock.

Since then, the biotech firm has solidified its place, with a gain of 1.36 percent this month alone but SK hynix down 0.17 percent.

Market analysts expect that Samsung Biologics shares have more room to grow thanks to the bright outlook on its contract-based development and manufacturing (CDMO) business.

“Samsung Biologics’ earnings are expected to continue to improve next year. It has already secured new orders that are nearly three times larger than that of the previous year, and has been successfully diversifying its business portfolio,” said Wi Hae-joo, an analyst at Korea Investment & Securities.

[Image source: SK hynix]

On the other hand, SK hynix is expected to suffer an operating loss of 1.50 trillion won next year due to a slump in the overall semiconductor industry. Chip inventory stocks are piling up on the shelf due to weakening demand in the sector, and most chip makers except Samsung Electronics are expected to dip into the red next year.

Memory chip prices are expected to remain on a downward spiral until the second quarter of next year due to a rise in inventories until the first quarter, according to Choi Do-yeon, an analyst at Shinhan Investment Corp.

SK hynix’s reserve for inventory loss increased by 234.5 billion won in the third quarter on quarter, said Noh Geun-chang, a researcher at Hyundai Motor Securities, expecting its inventory loss would significantly jump given a plunge in memory prices in the fourth quarter.