Samsung Electronics shareholders increase in number 5.65 times since stock split

By Anna J. Park

Since Samsung Electronics' stock underwent a split two years ago, the number of the blue chip's common stock shareholders has increased to 1.36 million in March this year, 5.65 times greater than 241,000 in March, 2018.

According to data released by the Korea Securities Depository and the Financial Supervisory Service, the average daily transaction amount of the stock between January and April this year has also hiked to 1.25 trillion won ($1.2 billion), a 75.34 percent increase from the same period in 2018.

The global tech-giant decided to split its stock 50-to-1 in May 2018, aiming to lower the stock's threshold for a wider number of retail investors as the stock price was too burdensome to be easily accessed. With the split, the stock price newly started at 53,000 won, down from the previous 2.65 million won.

The price went up to 62,400 won on Jan. 20 this year, yet with the spread of COVID-19, it plunged to 42,500 won on March 23, the lowest point of this year. At the crashing market, retail investors in Korea strongly buttressed the Korea-headquartered tech giant.

Foreign investors turned to net selling of the stock, worth of 7.88 trillion won from Jan. 20 to May 8, while individual investors net purchased the blue chip of 8.71 trillion won.

Samsung Electronics' shares are on its gradual track to rebound, finishing at 48,800 won at the closing of May 8, which is 14.82 percent up from the lowest point on March 23.

However, the current price is still way below 53,000 won; the price when the blue chip was split two years ago. In addition, the increase rate from the lowest point this year is behind the average increase rate of KOSPI index of 33.49 percent.

Market analysts see that part of the reasons lie in an outlook that the tech giant's demand shock would be materialized from the second quarter, despite sound first quarter results.

A recent analysis report published by Hana Financial Investment lowered Samsung Electronics' business profit estimate for this year to 30 trillion won from the previous estimate of 33 trillion won, reflecting an expected underperformance in its IT and mobile divisions, as well as its display and consumer electronics divisions. Yet the paper expected the stock price would reach 61,000 won.

Market intelligence firm IDC also predicted that the global semi-conductor market would post a negative 4.2 percent drop this year. Yet memory chip markets are still enjoying a positive outlook with the continual increase in contactless market trends.