Market: KOSPI (000660)
Brokerage : Mirae Asset Securities
Analyst : Young-gun Kim (Jae-ho Kim)
Investment Rating : BUY (Maintained)
Target Price : KRW 260,000 (Upgraded)
Core Momentum : Massive earnings estimate upgrades for 2024/2025 driven by stronger-than-expected memory pricing, alongside server replacement cycles and Blackwell/Rubin adoption exacerbating DRAM supply deficits
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / Target Price: KRW 260,000 (Upgraded by 8% from KRW 240,000) / Base Share Price (2024-07-24): KRW 208,500 (Upside potential: 24.7%)
- Target Price Valuation Logic:
- Operating profit forecasts for 2024 and 2025 revised upward by 23.4% and 62.5% respectively on stronger memory price projections.
- Target P/B multiple lowered from 2.3x to 2.1x to account for easing market dominance in HBM.
- Financial Performance & Forecasts:
- 2022: Revenue KRW 44.62 Trillion, Operating Profit KRW 6.81 Trillion, Net Profit KRW 2.23 Trillion
- 2023: Revenue KRW 32.77 Trillion, Operating Profit -KRW 7.73 Trillion, Net Profit -KRW 9.11 Trillion
- 2024(F): Revenue KRW 68.34 Trillion, Operating Profit KRW 24.26 Trillion, Net Profit KRW 18.32 Trillion
- 2025(F): Revenue KRW 98.61 Trillion, Operating Profit KRW 39.61 Trillion, Net Profit KRW 31.25 Trillion
- 2026(F): Revenue KRW 101.86 Trillion, Operating Profit KRW 31.24 Trillion, Net Profit KRW 25.23 Trillion
- Valuation Multiples (2022 → 2023 → 2024F → 2025F → 2026F):
- EPS: KRW 3,063 → -KRW 12,517 → KRW 25,168 → KRW 42,924 → KRW 34,655
- PER: 24.5x → N/A → 8.3x → 4.9x → 6.0x
- PBR: 0.8x → 1.8x → 2.1x → 1.5x → 1.2x
- ROE: 3.6% → -15.6% → 29.4% → 36.1% → 22.1%
- Operating Margin: 15.3% → -23.6% → 35.5% → 40.2% → 30.7%
- Dividend Yield: 1.6% → 0.8% → 0.6% → 0.6% → 0.6%
🚀 2. [Market Opportunities & Business Outlook]
- 2Q24 Earnings Summary:
- Consolidated Results: Revenue posted KRW 16.4 Trillion (+32.1% QoQ) and Operating Profit reached KRW 5.5 Trillion (+89.5% QoQ).
- Key Drivers: Continued price increases in DRAM (+15.2% QoQ) and NAND (+16.0% QoQ), initial revenue recognition of HBM3E, and favorable FX movements.
- 2025 Market Dynamics & Demand Drivers:
- DRAM Demand Bit Growth: Projected at +23.0% YoY in 2025, expanding from +17.1% in 2024.
- Segment Bit Growth: 2025F Server DRAM bit growth projected at +25.0% YoY and Graphic DRAM bit growth at +85.5% YoY.
- Conventional Server Replacement Cycle: Driven by the delayed replacement of servers purchased during the 2017–2018 mega-cycle (useful life extended from 3 to 6 years), 2025 server shipments are expected to achieve a 10-year high growth rate (+4.3%).
- Accelerator Architecture Transition: Customer ramp-up of the Blackwell platform and subsequent transition to Rubin will expand accelerator HBM content growth to +85.2% YoY (vs. +66.5% YoY in 2024).
- Supply-Demand Imbalance & Pricing Projections:
- Supply Bottlenecks: DRAM industry wafer capacity growth will be limited to 14.5% YoY in 2025, trailing demand growth. Industry CapEx growth (+48.3% YoY) is heavily tilted toward cleanroom infrastructure and HBM advanced packaging.
- Supply Excess Ratio: 2025 DRAM supply excess ratio projected at -9.3%, exacerbating undersupply compared to 2024 (-5.1%).
- Price Outlook: DRAM prices are forecasted to climb by +40% range YoY in 2025, sustaining strong momentum following 2024 gains.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix not as a company limited by slight multiple trims due to shifting HBM market share, but as a major beneficiary of severe structural DRAM undersupply (supply excess ratio of -9.3%) in 2025, catalyzed by conventional server replacement cycles and the rollout of Blackwell and Rubin architectures. Greater significance is attached to the +40% range DRAM price appreciation and 2025 operating profit reaching KRW 39.61 Trillion, supported by industry CapEx being restricted to infrastructure and packaging amid geopolitical uncertainties.
To assess whether this investment thesis unfolds as anticipated, key verification points include customer sales ramp-up of the Blackwell platform leading to +85.2% HBM content growth, realization of a 10-year high +4.3% growth in server shipments driven by 2017–2018 vintage server replacements, and whether DRAM undersupply (-9.3% excess ratio) successfully drives a +40% range YoY price increase in 2025. These developments can be verified through future quarterly earnings releases, official company IR materials, DART/KRX filings, and regular financial statements.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
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