Battery ETFs surge as AI data centers fuel ESS optimism

Exchange-traded funds (ETF) tracking secondary battery companies were among the top performers in the Korean stock market this month, data showed Friday, as investors bet on the industry amid expectations of rising demand from AI data centers.

According to data compiled by the Korea Exchange (KRX), the main bourse operator, eight of the 10 best-performing listed ETFs this month were related to the secondary battery industry.

Kodex Secondary Battery Industry Leverage ETF, managed by Samsung Asset Management, posted the highest return at 19.94 percent this month through Thursday, followed by Tiger KRX Second Battery Top10 Leverage ETF, managed by Mirae Asset Global Investments, at 18.45 percent.

Market watchers said investors apparently scooped up battery-related ETFs as the AI industry boom is expected to benefit the energy storage system (ESS) segment.

"Order momentum toward the end of this year is expected to be followed by share price momentum next year driven by improvements in sales and profitability of ESS businesses," said Kim Gwi-yeon, an analyst at Daishin Securities, who maintained an "overweight" rating on the sector.

Yonhap