KKR, one of the world's largest private equity firms, has declared that South Korea's long-running corporate reform push has finally turned into a genuine investment opportunity — and it expects semiconductors to be the engine behind that trade, accounting for 75% of earnings-per-share growth in the market.

The figure is the headline number in the firm's assessment of Korean equities. It anchors a view that the country's semiconductor sector — dominated by Samsung Electronics and SK hynix — will deliver the bulk of the earnings expansion KKR projects for Korean corporate Korea, rather than a broad-based recovery spread across conglomerates.

Why does reform matter now?

South Korea has spent years under pressure from regulators and minority shareholders to improve governance at its family-controlled chaebol. The government has pushed for higher dividends, unwinding of circular shareholdings and better board accountability. Foreign investors have historically treated Korean stocks as a persistent "Korea discount" — valuations below global peers for equivalent assets, justified by weak shareholder returns and opaque control structures.

KKR's position signals that this discount may now be closing. When a firm of its scale frames reform as an investable catalyst rather than a perennial promise, it marks a shift in how global capital views the market. The reform thesis matters commercially for the semiconductor supply chain because Samsung and SK hynix together supply a large share of the world's memory — DRAM and NAND — and Samsung is a distant second in contract logic chipmaking at advanced nodes. Any re-rating of the two companies flows directly into the capital available for fab construction and process development.

Where does the 75% come from?

The concentration of expected EPS growth in semiconductors reflects the structure of the Korean market itself. The two memory giants sit at the center of the global chip cycle, and their earnings swing harder than almost any other large-cap exposure in Asia. KKR's estimate effectively treats the rest of the Korean market — autos, shipbuilding, chemicals, consumer goods — as a stable but low-growth complement around a single dominant earnings driver.

That concentration cuts both ways. A sustained memory upcycle, driven by datacenter demand and tightening supply, would validate the thesis quickly. A downturn in DRAM or NAND pricing would expose the same concentration as a liability, since no other sector in the KKR framework comes close to offsetting a semiconductor earnings decline.

What should investors watch?

The KKR view rests on two variables moving in the same direction:

• Reform delivery: continued progress on dividends, buybacks and governance at the largest listed companies, which determines whether the valuation discount actually narrows.
• Semiconductor earnings momentum: memory pricing and HBM demand, which determine whether the 75% EPS-growth contribution materializes.

Neither is guaranteed, and KKR's 75% figure is a forecast, not a reported result. But the combination of a reform catalyst and a memory cycle turning upward is what makes the trade attractive to the firm now, after years of false starts on Korean governance pledges.

If Samsung and SK hynix sustain earnings momentum while reform keeps lifting payouts and valuations, KKR's framing suggests global capital flows into Korean equities — and into semiconductor exposure specifically — will accelerate through the coming cycle.