SK Square (402340.KS) surged more than 9% in early trading Saturday, setting another intraday record high. The rise in shares of its core subsidiary SK hynix (000660.KS), along with expectations for shareholder returns, is driving a reassessment of SK Square's stake value.
According to the Korea Exchange, SK Square was trading at 1.861 million won as of 9:50 a.m., up 161,000 won, or 9.47%, from the previous session. It briefly rose to 1.891 million won during the session, setting a new record high. Compared with its intraday low of 460,000 won on April 2, the stock has roughly quadrupled in about three months.
The intraday high also surpassed the highest target price set by securities firms. The top of the recent consensus target price for SK Square was 1.87 million won, presented by Daishin Securities, but the stock exceeded this, rising to 1.891 million won during the session.
What lifted the stock was SK hynix. SK Square is an investment company holding a 20.5% stake in SK hynix. As SK hynix shares surged on expectations for demand for high-bandwidth memory (HBM) and artificial intelligence (AI) chips, SK Square's net asset value (NAV) has also grown.
Securities analysts believe that the possibility of SK hynix expanding shareholder returns is also working positively on SK Square's stock price. SK Securities analyzed that since SK hynix has set its total shareholder return resources at around 50% of the free cash flow (FCF) generated over the three years from 2025 to 2027, future dividend expansion could lead to increased dividend income for SK Square. SK Square also announced a cash dividend of 200 billion won and a 40 billion won share buyback this year.
In terms of supply and demand, SK Square is also emerging as an alternative investment to SK hynix. As SK hynix's market capitalization weight in the KOSPI grows, some institutional investors face the burden of single-stock inclusion limits. SK Securities noted that SK hynix's KOSPI market cap weight disclosed on the first of this month was 21.26%, lower than its actual weight of 24.51%, suggesting that institution-led buying of SK Square could continue.
Daishin Securities also raised its target price for SK Square to 1.87 million won, presenting a similar rationale. "SK hynix accounts for 98.4% of SK Square's NAV," said Kim Hoe-jae, an analyst at Daishin Securities. "SK hynix's dividends, share buybacks, and the possibility of depositary receipt (DR) issuance could all serve as means of boosting SK Square's stock price or bringing in cash."
