[R&E] AI Infrastructure Shortage in Full Swing, KOSPI Accelerates Settling Above 4,800 Mark

[R&E: Research & Epoch]
This is News Epoch's signature report that analyzes vast market data to envision a new era of investment.

Market Overview: Key Indicators and Trends

Last weekend, the U.S. stock market saw the Dow, S&P 500, and Nasdaq indices close slightly lower due to uncertainties surrounding the appointment of the next Fed Chair and concerns over escalating geopolitical risks following former President Trump's announcement of impending tariffs. Nevertheless, on the previous trading day, the domestic stock market was buoyed by explosive earnings momentum in the semiconductor sector, with the KOSPI closing at 4,840.74pt (+0.90%), setting a record of 11 consecutive trading days of gains and successfully settling above the 4,800 mark. The KOSPI's year-to-date growth rate shows a distinct concentration in the IT sector, with semiconductor earnings upgrades contributing 98% of the rise. Today, some downward volatility may appear in the morning due to the slight corrective trend in the U.S. market and upward pressure on the KRW/USD exchange rate (1,473.6 won). However, with low pressure from foreign supply outflows and continued solid earnings outlooks for structural growth sectors, an alpha strategy focusing on stock picking rather than the index is expected to be relatively advantageous in the market.

Core Industry Issues and Insights

In the semiconductor industry, a key driver of structural growth, signs of an intensifying substrate shortage driven by the expansion of the AI accelerator market are being captured as the strongest signal. The price of Japan's Resonac's CCL (Copper Clad Laminate) is scheduled to increase by 30% starting from shipments on March 1, which means the ABF substrate upcycle is beginning in full swing. In particular, Gigavis, a beneficiary of the FCBGA expansion cycle, is expected to see its 2026 operating profit increase by +168% compared to the previous year, and ABF substrate companies are also entering a phase of profitability level-up through improved pricing power.

Earnings surprises in the infrastructure and capital goods sectors also provide powerful insights to the market. HD Hyundai Group affiliate HD Hyundai Marine Engine recorded an operating profit of 27.9 billion won in the fourth quarter, significantly exceeding the consensus, surging +205.3% compared to the same period last year. This supports the outlook that the effect of a surge in engine selling prices in 2026 will be reflected in earnings in earnest. Meanwhile, in the defense sector, HD Korea Shipbuilding & Offshore Engineering raised this year's order target for its special ship division to 3 billion dollars, a threefold increase from the previous year, revealing a strong willingness to expand its U.S. warship business, and Korea Aerospace Industries is also analyzed to have entered the early stages of an earnings upswing similar to the 2011 upcycle, despite some delivery delays.

Lastly, the cosmetic ODM and K-beauty sectors continue their solid trend based on strong global demand. Kolmar Korea is expected to record an estimated fourth-quarter operating profit of 53.8 billion won, exceeding the consensus, and Cosmecca Korea is also expected to significantly exceed 120 billion won in domestic business sales. In particular, Dongkook Pharmaceutical, where the beauty business accounts for 42% of sales, has set a target of growing overseas sales by more than 50%, raising expectations for the global expansion strategies of domestic beauty companies.

Market Signals

• DRAM Spot Price Surge: The DDR4 8Gb spot price has surged +56.56% over the past month, proving that the memory market recovery is progressing steeply.
  Copper Price Hits All-Time High: Driven by the explosive demand for AI servers and energy transition, the price of copper has surpassed 6 dollars per pound, breaking its historical all-time high.
  HD Hyundai Marine Engine Earnings Surprise: The fourth-quarter operating profit recorded 27.9 billion won, surging +205.3% compared to the same period last year, confirming overwhelming profitability.

Epoch View: Investment Implications

Today's market is likely to see expanded short-term volatility in the process of digesting the geopolitical noise that occurred last weekend. However, the market's attention continues to flow with more weight on the structural growth cycle that will last for more than two years, rather than on short-term events. In particular, the semiconductor substrate and materials/parts/equipment sector, a key pillar of AI infrastructure expansion, is evaluated as an area where the mid-to-long-term growth logic remains intact even in a correction phase. Meanwhile, China's steel export control policy and signals of a bottom-out rebound in lithium prices are once again highlighting the possibility of mid-to-long-term profitability improvement in the steel and secondary battery sectors. Secondary battery materials companies, which experienced significant stock price corrections due to concerns over slowing EV growth, are also in a phase where room for revaluation is being discussed around the new demand axis of ESS market expansion. In the content sector, although there are some game companies with expanded short-term stock price volatility due to adjusted release schedules for new titles, they remain a subject of market observation as expectations for mid-to-long-term earnings improvement itself are maintained.

This content was generated using News Epoch's proprietary AI algorithm, which tracks and analyzes public data from research centers of major domestic securities firms in real-time.
We clarify that this is an objective summary based on collected data, and is not a solicitation or recommendation to invest in specific stocks.