Top 10 Conglomerates' Market Cap Evaporates by 100 Trillion Won This Year Amid Early-Year Stock Market Slump

Combined Market Cap of Top 10 Groups Down About 107 Trillion Won from Last Year-End
Large Cap Weakness and Secondary Battery Slump Due to Foreign Selling

As the stock market continued to show sluggish performance at the beginning of the year, the market capitalization of the top 10 conglomerates has evaporated by as much as 100 trillion won. Large-cap stocks showed weakness due to foreign selling, and the continued correction of secondary battery stocks is interpreted as leading to the decrease in the market capitalization of the top 10 groups.

According to financial information company FnGuide on the 23rd, as of the 19th, the total market capitalization of the top 10 groups was 1,242.859 trillion won, down 106.9904 trillion won from 1,349.8489 trillion won at the end of last year. Market capitalization decreased across all top 10 groups.

The group with the largest market cap decline this year was POSCO. POSCO's market cap fell 19.77% from 93.8751 trillion won at the end of last year to 75.3134 trillion won. Along with this, Lotte (-12.59%), Hyundai Motor (-12.08%), and LG (-11.71%) recorded double-digit decreases.

The best performer was GS. GS's market cap decreased by only 1.8% this year. In addition, HD Hyundai showed a decline of -3.58%, Hanwha -4.32%, SK -4.36%, Samsung -5.62%, and Shinsegae -9.91%.

The decrease in market capitalization of these top 10 groups appears to be influenced by the weakness of large-cap stocks due to foreign selling pressure since the beginning of the year. The KOSPI fell 6.87% through the 19th of this year. During the same period, the KOSDAQ fell 2.76%. Within the KOSPI, the large-cap index fell 7.27%, showing a larger decline than mid-cap (-5.69%) and small-cap (-1.46%) stocks. Foreign investors sold more than 6 trillion won in the futures market this year. Roh Dong-gil, a researcher at NH Investment & Securities, said, "Foreign investors reduced their holdings in the domestic stock market, focusing on large-cap stocks, due to concerns such as disinflation reversal and fourth-quarter earnings worries from last year," adding, "Large-cap stocks at the top of the market capitalization centered on the KOSPI 200 fell due to net selling by foreigners in both spot and futures markets."

The continued sluggishness of secondary battery stocks since the second half of last year also affected the market cap decline. POSCO recorded the highest growth rate last year with a 123% increase in market capitalization, driven by the strength of secondary battery stocks, but with the underperformance of secondary battery stocks this year, it recorded the largest market cap decline. By stock, many secondary battery-related stocks were among the bottom in market cap change rates. POSCO DX recorded the largest market cap decline rate at -24.53%, followed by POSCO Future M at -22.42%. Samsung SDI (-20.76%), SK Innovation (-19.03%), and LG Chem (-18.94%) also saw significant market cap reductions.

In particular, POSCO DX, which led the POSCO Group's market cap growth rate last year by posting the highest stock price increase among all stocks, is showing the exact opposite trend this year. POSCO DX's stock price rose 1,087.20% last year. However, since its transfer listing to the KOSPI this year, its stock price has continued to underperform. POSCO DX's stock price has fallen every day except for two days this year. Starting trading at 75,600 won at the beginning of the year on the KOSPI, POSCO DX has now dropped to around 55,000 won. Han Ji-young, a researcher at Kiwoom Securities, said, "Secondary battery stocks have not been able to escape the stock price slump since the beginning of the year, and the supply-demand conditions are also unfavorable."