Finance

Goldman Flags Undervalued Korea as Governance Advances, AI Demand Lifts Earnings

Goldman Sachs' equity researchers say South Korea's equity market remains undervalued relative to regional and global peers. Governance reforms are progressing, and AI-driven demand is supporting earnings, adding upside for a market that has already rallied. The Kospi surged—about 75% in 2025 and roughly 40% more since—driven by domestic memory-chipmakers.

📅 April 17, 2026
⏱️ 2 min read
Goldman Flags Undervalued Korea as Governance Advances, AI Demand Lifts Earnings

Key Takeaways

  • Goldman Sachs says Korea equities are undervalued relative to peers, signaling potential upside as reforms progress.
  • Kospi 2025 rally delivered about 75% returns, with ~40% gains since then, led by domestic memory chipmakers.
  • Governance reforms are advancing with more shareholder-friendly actions like buybacks and treasury share cancellations.
  • About 70% of Kospi constituents trade below book value, suggesting valuation catch-up potential.
  • Catalysts include governance reforms, buybacks, and AI-driven semiconductor demand, with risks from energy-price shocks and regulatory shifts.

People Involved

  • Kim Sung-hwan Korea Energy Minister
  • Goldman Sachs analysts Equity research team

Entities Involved

  • Goldman Sachs Investment bank providing equity research commentary on Korea equities
  • Kospi South Korea's benchmark stock index
  • Korea Energy Ministry (MOTIE) Government energy policy authority

MarketMoodz Analysis

For investors, Goldman’s view frames Korea as a still-undervalued beta play, with upside increasingly tied to AI-enabled semiconductors and improved capital allocation. Incremental governance reforms could lift multiples, though the payoff is likely back-end loaded as reforms take time to materialize in earnings.

Valuation gaps persist versus regional EM peers, in part due to Korea’s energy-import exposure, which amplifies sensitivity to energy prices. If energy prices stabilize or fall and reforms continue, the market could start to re-rate, particularly in semiconductors, exporters, and high-visibility tech names.

What to watch next: ongoing AGM-season buybacks, actual execution of treasury-share cancellations, and AI-driven demand signals from chipmakers; monitor energy-price trajectories and geopolitical developments that could affect Korea’s export cycle.

Source: Original Article

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