Foreign investment in Korean companies jumps 30% in a year

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Foreign investment in listed companies here surged by about 30 percent over the past year, led largely by U.S. asset managers and investment funds. Cosmetics, semiconductors and biotechnology attracted particularly strong interest, data showed Wednesday.

According to CEO Score, a corporate research firm, foreign companies and funds held stakes of at least 5 percent in 123 of Korea’s 500 largest listed companies by market capitalization as of June. The figure was up 29.5 percent from 95 a year earlier.

By country, U.S.-based investors accounted for more than half of the total, with holdings in 69 companies. They were followed by European investors with holdings in 25 companies, Japanese investors with 10 and Chinese investors with eight.

BlackRock held stakes in the largest number of Korean-listed companies. The world’s largest asset manager added 12 companies to its portfolio of holdings of at least 5 percent, becoming a major shareholder in 19 Korean companies.

Its largest holdings included stakes of 7.41 percent in KB Financial Group, 7.22 percent in Hana Financial Group, 7.18 percent in Woori Financial Group and 7.16 percent in LG Display. BlackRock also held stakes of 5.14 percent in Samsung Electronics and 5.11 percent in SK hynix.

European investment largely came from state-run funds and asset managers. Norges Bank Investment Management held stakes in six companies, including 6.16 percent of CJ Logistics and 6.08 percent of Cosmax.

Japanese investors held stakes in 10 Korean companies, many linked to joint ventures in the technology and security sectors. Notable examples included Tokai Carbon’s 52.63 percent stake in TCK, Secom’s 25.65 percent stake in S-1 and Nippon Kolmar’s 11.77 percent stake in Kolmar Korea.

Chinese investors, led by technology giant Tencent, held stakes in eight Korean companies in the gaming and entertainment industries.

By industry, cosmetics recorded the largest increase in foreign investment. The number of foreign investors holding stakes of at least 5 percent in cosmetics companies rose from just two in June last year to nine as of June this year.

Cosmax, a cosmetics original design manufacturer, drew strong interest from investors.

GIC acquired a 6.33 percent stake, Norges Bank Investment Management acquired a 6.08 percent stake, while the Government of Singapore acquired a 5.4 percent stake.

Skincare brand d’Alba Global also attracted sizable investments from M&G Investments and Fidelity International, which acquired stakes of 7.58 percent and 5.06 percent, respectively. APR, a beauty-device maker, gained a new major shareholder after Fidelity Investments acquired a 5.01 percent stake.

Foreign investment in the semiconductor and pharmaceutical and biotechnology sectors increased, with four additional companies in each sector attracting foreign shareholders with stakes of at least 5 percent.

In the semiconductor sector, foreign capital expanded beyond large-cap stocks such as SK hynix into smaller parts and equipment manufacturers with specialized technologies, including MiCo, GST, Eugene Technology, KoMiCo and SemiFive.

In the pharmaceutical and biotechnology sector, BlackRock held a 6 percent stake in HLB and a 5 percent stake in Yuhan Corp., while Kopernik Global Investors increased its stake in Chong Kun Dang to 8.38 percent.