May 27, 2024

Samsung Group will invest KRW 450 trillion (roughly Rs. 27,60,920 crore) in the next five years to accelerate growth in semiconductors, biopharmaceutical, and other next-generation technologies, Samsung Electronics said.

South Korea’s top conglomerate said on Tuesday the investments through 2026 are expected to help Samsung drive long-term growth in strategic areas such as the chip sector, while pledging aggressive investments in the biopharmaceutical sector to make it as successful as its chip business.

Samsung Electronics, the world’s largest memory chip maker, did not provide a breakdown of the figures, though it added that 80 percent of investments will be made in South Korea and that Tuesday’s announcement includes a KRW 240 trillion (roughly Rs. 14,72,610 crore) investment pledge made in August 2021.

Samsung did not include electric vehicle batteries as a future growth engine in the announcement.

Samsung SDI, the group’s battery unit, and Stellantis, the parent company of Chrysler, are scheduled to announce their new battery plant in the US state of Indiana on Tuesday.

Securing domestic chip and bio supply chains will have strategic significance and be important for South Korea’s economic security, Samsung said in the announcement.

The KRW 450 trillion (roughly Rs. 27,60,920 crore) investments, expected to create 1.07 million jobs, are over 30 percent greater than the KRW 330 trillion (roughly Rs. 20,25,110 crore) Samsung invested in the five years to 2021.

Recently, the South Korean tech giant posted a 58.57 percent rise in first-quarter net profits, largely driven by steady memory chip demand and brisk smartphone sales. The world’s biggest memory-chip maker is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled empires known as chaebols that dominate business in South Korea, Asia’s fourth largest economy.

The conglomerate is crucial to the South’s economic health – its overall turnover is equivalent to a fifth of the national gross domestic product.

The firm said net profit in the January-to-March period was KRW 11.32 trillion (roughly Rs. 68,155 crore) – up 58.57 percent from the same period year earlier.

© Thomson Reuters 2022