In a remarkable turn of events, SK Eternix, the renewable energy division of South Korea’s SK Group, has seen its share prices skyrocket by over 114% in the past month. This surge is largely attributed to investor confidence that the burgeoning development of artificial intelligence (AI) infrastructure will substantially boost the demand for renewable energy sources. By the end of trading on Friday, the company’s stock stood at 80,900 won, equivalent to US$55.35, marking a 114.6% increase compared to a month ago. Meanwhile, the Kospi index experienced a steep decline of 20.9%, and shares of SK hynix, the group’s main semiconductor arm, fell by 31.2%.
The momentum behind SK Eternix’s rally gained even more traction over the last week, with a 44.9% rise in just five trading days. Institutional investors have been particularly active, acquiring a net total of 106.8 billion won in shares, while foreign investors added a net 79 billion won to their portfolios. Analysts are pointing to the anticipated rise in electricity demand from AI data centers, which consume substantial power, as a key factor driving long-term interest in renewable energy stocks. The South Korean government’s commitment to expanding its clean energy capacity further bolsters this optimistic outlook.
In June, the government outlined projections that major industrial initiatives, such as AI data centers and semiconductor manufacturing hubs, would require an additional 39.7 gigawatts of electricity. It also reaffirmed its ambitious objective of increasing the nation’s renewable energy capacity to 100 gigawatts by the year 2030, aligning with the global push towards sustainable energy solutions.
Adding to the positive sentiment is SK Eternix’s strategic move to establish a 2 trillion won renewable energy joint venture with the global private equity firm KKR. This partnership is anticipated to accelerate SK Eternix’s expansion in the clean energy sector, further enhancing its growth prospects and appealing to investors keen on sustainable investments.