Amid a global boom in artificial intelligence (AI), President Lee Jae-myung has announced that fostering the AI industry will be a key policy. With the rise of big tech focused on AI, the U.S. stock market has reached an all-time high, leading to expectations that the domestic stock market will also experience an "AI rally."
However, the "AI rally" observed in the domestic stock market often results in only short-term gains, unlike the U.S. example. Additionally, most stocks whose prices are rising significantly are small and mid-cap stocks, with larger companies related to AI not feeling the same warmth. There are concerns that the AI industry in the Korean stock market may turn out to be a highly volatile theme.
President Lee Jae-myung, who took office on the 4th, emphasized the promotion of the AI industry throughout the election campaign. As NVIDIA, a leading representative of AI on the U.S. stock market, rises again, domestic stocks related to AI surged as the new government focused on supporting AI.
However, the stocks that surged were primarily small-cap AI-related companies. Konan Technology, which developed a large language model (LLM), and Saltlux, which provides AI customer service solutions and chatbots, are notable examples. Konan Technology and Saltlux each rose by around 50% in just three trading days this month. SELVAS AI, which utilizes AI technology to manufacture medical devices, also saw its stock rise nearly 20% during this period.
Since President Lee's inauguration, significant funds from foreign and institutional investors have flowed into the domestic stock market, leading to investments in large-cap AI stocks as well. Stocks of semiconductor companies like SK hynix and Samsung Electronics, along with Kakao, which has announced plans to launch a Korean Super Agent platform in collaboration with the global AI platform OpenAI in the second half of the year, also increased. However, the stock price growth of these large stocks has only matched the index growth rate.
Not all AI-related stocks have received attention. Samsung SDS, which plans to introduce generative AI for financial applications in the second half of the year, and NAVER, considered a representative stock in AI, saw their stock prices rise less than the index. Despite the new government's emphasis on supporting the AI industry, AI-related stocks have not gained as much momentum as expected.
Although a significant opportunity has opened for domestic AI-related corporations, there are many instances where investment funds initially flowed in based on AI technologies and business plans but no longer attract attention. Stocks of AI software development companies such as VAIV Company, DEEPNOID, and ESTsoft significantly rose earlier this year but now remain stagnant.
AI is particularly classified as a theme subject to significant fluctuations. The difficulty of implementing sophisticated AI technologies is high, and it is still challenging to commercialize these technologies for profit. From an investor's perspective, it is difficult to visually confirm business results in the short term, so if companies do not continually present specific future plans, interest often wanes rapidly. Most investors only ride the wave briefly when stock prices surge and then exit.
As expectations for policy benefits from the global AI boom grow, the situation where everyone claims to be related to AI is something investors should watch out for.
As interest in AI technologies increased last year, many listed companies announced plans to launch AI-related businesses. However, a survey by the Financial Supervisory Service revealed that about one in three did not show any performance in promoting related businesses. They neither recruited specialized personnel nor organized teams, and there was also no research and development activity. There are even cases where companies intentionally include AI in their names, misleading investors into thinking they are AI-related firms, despite not being their core business.
A representative of an asset management company said, "A trend is emerging where AI stocks in the software sector appear to follow thematic stocks in the domestic market, but this is due to the fact that these companies have not been able to show concrete results."
This representative emphasized, "If AI remains as a simple thematic trend, it will be difficult to foster a healthy AI industry ecosystem in Korea. Specific policies must be established to support corporations in honing their related technologies."