(Bloomberg) -- While declines in chip and Internet giants have put South Korean equities on course for their worst year since the global financial crisis, investors found winners in the electric-vehicle supply chain and defense sector.

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The benchmark Kospi is down about 22% in 2022, headed for its largest loss since 2008. The biggest drags include a 26% decline in Samsung Electronics Co. and a loss of double that size in Kakao Corp., as growth stocks were pummeled worldwide over recession fears.

Other losers included some of last year’s biggest gainers, such as metaverse, video game and crypto stocks. Shares of firms tied to entertainment hits such as Netflix’s “Squid Game” have endured white-knuckled volatility amid fears they could turn out to be one-hit wonders.

“It was a year of suffering for growth stocks,” said An Hyungjin, chief executive officer at Billionfold Asset Management, also noting the “vicious circle” of big directional changes.

The $10.7 billion share float from electric-vehicle battery maker LG Energy Solution Ltd. meanwhile lured investors as they moved away from chip stocks. The Tesla Inc. supplier split off from LG Chem Ltd. has climbed 53% since its January debut and become the No. 2 weighted stock in the Kospi.

The global race to increase arms spending generated an export windfall for Korean defense firms. Korea Aerospace Industries Ltd., Hanwha Aerospace Co. and Hyundai Rotem Co. have seen their stocks climb more than 30% each.

Brokerages including Goldman Sachs, Morgan Stanley and Nomura have raised their views on South Korean equities for next year, citing cheap valuations, a possible rebound in memory chip stocks and potential benefits from China’s reopening.