Samsung Electronics Announces 110 Trillion Won Shareholder Return

Samsung Electronics announced a shareholder return plan totaling over 110 trillion won, which is more than five times its previous maximum shareholder return of 20 trillion won. This includes a 30 trillion won cash dividend in the third quarter alone, raising expectations that the normalization of performance will clearly proceed.

While SK Hynix carries out shareholder returns by immediately buying back and canceling its own shares, Samsung Electronics faces structural limitations. This is due to Samsung Life owning 8.51% of Samsung Electronics shares and Samsung Fire & Marine owning 1.49%. Under the Financial Industry Separation Act, which regulates the separation of financial and industrial capital, a financial company's shareholding limit in non-financial affiliates is capped at 10%. If Samsung Life and Samsung Fire & Marine exceed their shareholding in Samsung Electronics, there is a risk of forced sale. Therefore, analysis suggests that Samsung Electronics faces difficulty in implementing a return policy that reduces outstanding shares through large-scale share buybacks and cancellations.

Of Samsung Electronics' 30 trillion won dividend in the third quarter, 15 trillion won will be used for employee compensation. An additional announcement regarding the remaining 80 trillion won shareholder return plan is expected in January next year. The market anticipates that shareholder return policies, such as share buybacks and cancellations, may be announced at that time, and the dividend yield for Samsung Electronics preferred shares currently stands at over 8%.

Global investment banks, including JP Morgan, project that Samsung Electronics' market share in the HBM4 market will increase to 41%. This contrasts with the declining HBM3 share of SK Hynix, with analysis suggesting Samsung Electronics will reverse market share in HBM4. Micron's HBM market share is expected to remain at its current level of 20-21%.

Samsung Electronics' HBM sales proportion increased from 35% in Q2 to 38% in Q3 and is projected to reach 40% by the end of this year. The upside for HBM proportion increase next year is estimated at 20-30% for Samsung Electronics and 10% for SK Hynix. Currently, HBM prices have risen 2.5 times compared to the beginning of the year, and this upward trend is expected to continue. This is interpreted as a positive sign that Samsung Electronics' HBM business growth will persist.