Brokerage : Daishin Securities
Analyst : Kang-ho Park
Investment Rating : BUY (Maintained)
Target Price : KRW 170,000 (Lowered by -5.5%)
Core Momentum : Transitioning into a high-margin growth cycle in 2025 past two years of contraction, powered by an expanding Non-IT mix (automotive/AI) and FC-BGA annual sales surpassing KRW 1T.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / KRW 170,000 (Lowered by -5.5%, applying a target P/E of 18.2x to 2025F EPS at the upper end of growth multiple)
- Current Share Price (As of Dec 11, 2024): KRW 119,300
- Market Capitalization: KRW 9.07T
- Key Financial Metrics & Forecast:
- Revenue: 2023A KRW 8.91T → 2024F KRW 10.18T (+14.2% YoY) → 2025F KRW 10.69T (+5.1% YoY) → 2026F KRW 11.60T
- Operating Profit: 2023A KRW 639.0B → 2024F KRW 758.0B (+18.6% YoY, OPM 7.5%) → 2025F KRW 901.0B (+18.8% YoY, OPM 8.4%) → 2026F KRW 1.07T (OPM 9.2%)
- Net Profit (Controlling): 2023A KRW 423.0B → 2024F KRW 539.0B → 2025F KRW 726.0B → 2026F KRW 863.0B
- EPS: 2023A KRW 5,450 → 2024F KRW 7,207 → 2025F KRW 9,358 → 2026F 11,063
- PER: 2023A 28.1x → 2024F 16.1x → 2025F 12.4x → 2026F 10.5x
- PBR: 2023A 1.5x → 2024F 1.1x → 2025F 1.0x → 2026F 0.9x
- ROE: 2023A 5.5% → 2024F 6.9% → 2025F 8.3% → 2026F 9.0%
- 4Q24 Earnings Preview: Projected Revenue of KRW 2.36T (+2.1% YoY, -9.9% QoQ), Operating Profit of KRW 145.3B (+31.6% YoY, -35.4% QoQ), missing Daishin’s previous estimate (KRW 171.0B) and market consensus (KRW 167.3B) due to off-season softness and weaker IT product mix.
- 1Q25 Earnings Outlook: Projected Revenue of KRW 2.70T (+2.7% YoY, +14.5% QoQ), Operating Profit of KRW 195.0B (+7.9% YoY, +34.0% QoQ).
🚀 2. [Market Opportunities & Business Outlook]
- Portfolio Restructuring: Strategic investments over the past three years in FC-BGA and high-end MLCCs are turning into tangible earnings, ending the 2022–2023 contraction with record revenue surpassing KRW 10T in 2024 and expanding growth into 2025.
- Component Division (MLCC): Global automotive MLCC market share expanded to 15% (+11%p vs. 2022). Combined automotive and industrial MLCC revenue share is projected to exceed 40% in 2025. Fab utilization is expected to rise from the low-80% level in 2H24 to 90% in 2H25, entering a structural high-margin phase.
- Package Substrate Division (FC-BGA): Currently supplying server substrates to AMD and Amazon, with customer diversification ongoing. Backed by Vietnam plant operations, full-year 2025 FC-BGA revenue is forecast to jump +34.2% YoY, surpassing KRW 1T for the first time.
- Growth Catalysts: Structural demand from AI smartphones/PCs, autonomous driving, and expanding shipments of high-value MLCCs, FC-BGA, and automotive cameras are set to accelerate profit margins.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not as a legacy supplier burdened by transient IT hardware demand softness, but as an advanced electronics hardware manufacturer entering a harvest phase where three years of strategic capital allocation into server FC-BGA and automotive MLCCs materialize into profit acceleration. Short-term 4Q seasonal softness is viewed as largely priced in, with the primary thesis centering on valuation appeal (2025F P/B ~1.0x) and structural margin expansion as FC-BGA sales exceed the KRW 1T milestone.
To evaluate whether this investment thesis progresses according to expectations, key tracking points include whether 2025 FC-BGA annual revenue surpasses KRW 1T alongside additional server customer wins, whether the combined automotive and industrial MLCC revenue share exceeds 40%, and the sequential progression of MLCC fab utilization toward 90% in 2H25. These developments can be monitored through upcoming quarterly financial announcements, official company IR presentations, and regulatory filings.
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