Market: KOSPI (000660)
Brokerage : Daishin Securities
Analyst : Seok-hwan Shin
Investment Rating : BUY (Maintained)
Target Price : KRW 230,000 (Upgraded, +5%)
Core Momentum : 1Q24 earnings surprise and NAND return to profitability, expanding DRAM operating margins driven by 2Q24 8Hi HBM3E volume recognition, and QLC-based high-capacity eSSD demand growth
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / Target Price: KRW 230,000 (Upgraded by +5%) / Base Share Price (24.04.25): KRW 170,600 / Market Cap: KRW 124.20 Trillion
- Target Price Valuation Logic:
- Derived by applying a Target P/B multiple of 2.1x (historical P/B band upper end) to 2025E BPS of KRW 110,038.
- Financial Performance & Forecasts:
- 2021A: Revenue KRW 42.998 Trillion, Operating Profit KRW 12.410 Trillion, Controlling Net Profit KRW 9.602 Trillion
- 2022A: Revenue KRW 44.622 Trillion, Operating Profit KRW 6.809 Trillion, Controlling Net Profit KRW 2.230 Trillion
- 2023A: Revenue KRW 32.766 Trillion, Operating Profit -KRW 7.730 Trillion, Controlling Net Profit -KRW 9.112 Trillion
- 2024F: Revenue KRW 63.202 Trillion (KRW 63.2 Trillion in text), Operating Profit KRW 19.431 Trillion (KRW 19.4 Trillion in text), Controlling Net Profit KRW 11.826 Trillion
- 2025F: Revenue KRW 74.551 Trillion, Operating Profit KRW 25.779 Trillion, Controlling Net Profit KRW 16.152 Trillion
- Valuation Multiples (2021A → 2022A → 2023A → 2024F → 2025F):
- EPS: KRW 13,190 → KRW 3,063 → -KRW 12,517 → KRW 16,244 → KRW 22,187
- BPS: KRW 85,380 → KRW 86,904 → KRW 73,495 → KRW 88,784 → KRW 110,038
- PER: 9.9x → 24.5x → N/A → 9.6x → 7.1x
- PBR: 1.5x → 0.9x → 2.3x → 1.9x → 1.6x
- ROE: 16.8% → 3.6% → -15.6% → 20.0% → 22.3%
🚀 2. [Market Opportunities & Business Outlook]
- 1Q24 Earnings Surprise & Segment Breakdown:
- Consolidated Results: Revenue recorded KRW 12.43 Trillion (+144.3% YoY, +9.9% QoQ) and Operating Profit reached KRW 2.89 Trillion (turning profitable YoY, +734.0% QoQ), significantly beating consensus (Operating Profit KRW 1.86 Trillion).
- DRAM Segment: Revenue estimated at KRW 7.6 Trillion (+158% YoY) and Operating Profit at KRW 2.3 Trillion (turning profitable YoY). While 1Q Bit Growth declined -14% QoQ due to seasonal softness in PC/mobile/consumer DRAM, premium products (HBM, DDR5) drove solid profitability.
- NAND Segment: Revenue estimated at KRW 4.3 Trillion (+161% YoY) and Operating Profit at KRW 0.5 Trillion (turning profitable YoY). Driven by strong eSSD/high-capacity SSD demand, NAND price gains, and ~KRW 0.9 Trillion in inventory valuation allowance reversals, the division successfully returned to profitability.
- 2Q24 Earnings Outlook:
- Consolidated Forecast: Revenue projected at KRW 15.70 Trillion (+114.9% YoY, +26.3% QoQ) and Operating Profit at KRW 4.61 Trillion (turning profitable YoY, +59.6% QoQ).
- Shipment & Pricing: DRAM Bit Growth +14% QoQ, ASP +11% QoQ / NAND Bit Growth Flat, ASP +10% QoQ.
- Margin Catalysts: Expanding revenue share of AI/server DRAM and the full-scale commercial recognition of 8Hi HBM3E will sharply accelerate DRAM profit margins.
- 2024 Annual Division Projections:
- DRAM Division: Operating profit projected at KRW 16.8 Trillion (OPM 41%).
- NAND Division: Operating profit projected at KRW 2.8 Trillion (OPM 14%). High-capacity QLC eSSD demand will sustain genuine growth even when excluding inventory reversals.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix not merely as a company benefiting from one-off inventory reversals, but as an industry-leading AI memory leader that has confirmed structural operational turnarounds across both DRAM and NAND through solid HBM market dominance and surging QLC-based eSSD demand. Greater weight is attached to the full-scale commercial recognition of 8-high (8Hi) HBM3E starting in 2Q24 and full-year operating profits reaching KRW 19.4 Trillion (DRAM OPM 41%, NAND OPM 14%) rather than near-term quarterly base effects.
To assess whether this investment thesis unfolds as anticipated, key verification points include achieving 2Q24 operating profit of KRW 4.61 Trillion, sharp margin expansion in DRAM driven by 8Hi HBM3E volume deliveries, and confirming that the NAND division sustains its path toward KRW 2.8 Trillion in full-year operating profit backed by genuine QLC eSSD demand beyond one-off inventory reversals. 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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