HONG KONG, July 11 Reuters Hedge funds hunting for artificial intelligencerelated stock market bargains are rushing into South Korea39;s chipmakers, betting a new wave of demand for highend memory chips and government spending makes them more valuable.

Britain39;s Man Group, Singapore39;s FengHe Fund Management and Hong Kong39;s CloudAlpha Capital Management and East Eagle Asset Management are among the hedge funds seeking AI exposure in Asia that are looking to South Korean behemoths such as SK Hynix and Samsung Electronics, which have so far lagged the sector39;s rally.

If we consider Nvidia the king of the AI story, then Hynix is the queen, said Matt Hu, chief investment officer of 4 billion FengHe, which has been buying Hynix and Samsung this year.

FengHe and other hedge fund investors believe the AI frenzy over the past year that trebled the value of U.S.listed Nvidia39;s shares to more than 3 trillion has left behind stocks such as Hynix relative to more popular Asian AI players such as Taiwan39;s TSMC

But the spotlight is turning to South Korean chipmakers as technology firms in the generative AI race scurry to secure highbandwidth memory HBM chips manufactured primarily by Hynix, Samsung and U.S.based Micron Technology.

Hynix is the top supplier of advanced HBM memory chips to Nvidia. FengHe39;s Hu estimates Hynix receives a larger proportion of its revenue from Nvidia than TSMC does, but Hynix trades at 9 times its 12month forward earnings versus 23 times…