AI, robotics stocks rise as Samsung plans future business

Stocks of emerging industries such as artificial intelligence (AI), robotics, and autonomous vehicles are gaining ground following the announcement by South Korea’s Samsung Group on Monday to establish a new team dedicated to future business planning.

Shares of Samsung SDS Co., the information technology (IT) service unit of Samsung Group, reached a 52-week high of 168,400 won ($129.6) on Thursday after gaining 8.5 percent over the past four days.

On November 24, Samsung SDS’s closing price was 155,200 won.

Samsung SDS is in charge of system integration (SI) within Samsung Group. The stock gathered momentum on projections that AI will be one of the priorities of Samsung Group’s new business planning unit.

In particular, if the group converts its production facilities into AI-based factories such as those of Tesla Inc. to secure future competitiveness, Samsung SDS’s sales are likely to increase further as a shift from hardware to data and generative AI would mean big roles to the group’s SI operator with cloud business services.

Last month, Macquarie Securities raised its price target for Samsung SDS to 175,000 won from 100,000 won, projecting that its cloud-related revenue will grow at an annual average of 30 percent until 2025.

“Samsung SDS is seeing results in its data center expansion,” said Kim Ha-jeong, an analyst at DAOL Investment & Securities Co. “It is also boosting business related to the establishment of generative AI.”

Kim noted that growth in IT service profits is expected to lead to higher valuation.

Stocks related to multilayer ceramic capacitors (MLCCs) and chip design also rose on hopes for the expansion of AI businesses, including inferential AI and on-device AI as well as generative AI.

As power control devices are needed to drive high-performance AI chips, MLCC maker Samsung Electro-Mechanics Co. saw its shares rise 6.4 percent this week.

Shares of semiconductor design company Chips&Media Inc. also gained 5.5 percent and chips development company Gaonchips Co. 9.1 percent between Monday and Thursday.

Robotics stocks are also enjoying another upswing with the boost of Samsung Group’s future businesses.

Shares of Doosan Robotics Inc. rose 12.9 percent on Thursday from the previous session, marking the 12th consecutive day of gain.

Shares of Rainbow Robotics Inc. also increased 8 percent this week.

With the appointment of Jun Young-hyun, board chair of Samsung SDI, as head of Samsung Electronics Co.’s future business planning team, the electric and autonomous vehicle themes related to secondary batteries are also highlighted.

Shares of car audio manufacturer Anam Electronics Co. gained 12.3 percent this week, automotive chip maker Telechips Inc. 11.1 percent, and Furonteer Inc. 4.2 percent.