Naver shares surge on AI optimism, hit 52-week high

Naver's headquarters in Seongnam, Gyeonggi Province (Newsis)

Naver shares surged for the second consecutive session on Thursday, buoyed by investor optimism over the Lee Jae Myung administration’s commitment to nurturing the domestic artificial intelligence sector.

The internet giant closed at 252,000 won ($182.47) on the main bourse Kospi, up 3.49 percent from the previous session. This followed a nearly 18 percent on Wednesday, marking a two-day rally that has captured market attention.

It is the first time Naver shares have topped 250,000 won since Aug. 19, 2022, when it traded at 251,000 won.

During early trading Thursday, Naver briefly touched 259,000 won, setting a new 52-week high.

The company's market capitalization ranking also rose, climbing from 11th to 8th on the Kospi in just two trading days, overtaking Samsung Electronics preferred shares, Kia and Doosan Enerbility.

Investor sentiment has been further buoyed by the appointment of Ha Jung-woo, head of Naver's Future AI Center, to the newly established post of senior presidential secretary for AI and future technology planning. His appointment is seen as a strategic move aligning with the government’s AI ambitions.

President Lee has pledged to build a national large language model to make AI accessible to all citizens, raising expectations for Naver’s participation in the landmark project.

Global investment banks have reinforced this momentum. On Tuesday, JPMorgan raised its target price for Naver from 250,000 won to 270,000 won, while maintaining its “overweight” rating.

Citigroup followed suit Thursday, naming Naver its top pick among Korean internet platform stocks and lifting its target price from 270,000 won to 300,000 won.

“Foreign investors turned net buyers after JPMorgan raised its investment rating on Naver to ‘overweight,’ citing potential benefits from the Korean government’s 100 trillion won AI investment plan and the appointment of a new senior secretary for AI who previously served at the IT giant,” said Lee Kyung-min, an analyst from Daishin Securities.

Meanwhile, shares of Naver’s crosstown rival Kakao also rallied as a potential beneficiary of AI policies.

Kakao closed at 60,400 won, up 9.42 percent from the previous session. During the day, the stock hit a 52-week high of 61,800 won.