Brokerage : Hana Securities
Analyst : Rok-ho Kim, RA: Young-kyu Kim
Investment Rating : BUY (Maintained)
Target Price : KRW 200,000 (Maintained, 12M Target Price)
Core Momentum : Expanding earnings quality and visibility across business units as AI benefits broaden from AI servers to 2H On-Device AI MLCCs, reinforced by the 3Q ramp-up of server CPU and GPU substrates.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / KRW 200,000 (Maintained, 12M Target Price; currently trading around historical average PBR band with minimal valuation burden, with potential to test upper band multiples as AI benefits expand)
- Current Share Price (As of Jul 31, 2024): KRW 159,600
- Market Capitalization: KRW 11.92T
- Key Financial Metrics & Forecast:
- Revenue: 2023A KRW 8.91T → 2024F KRW 10.53T (Table: KRW 10,527.2B) → 2025F KRW 11.89T (Table: KRW 11,890.7B)
- Operating Profit: 2023A KRW 639.4B → 2024F KRW 877.4B (OPM 8.3%) → 2025F KRW 1.22T (Table: KRW 1,216.0B, OPM 10.2%)
- Net Profit: 2023A KRW 423.0B → 2024F KRW 721.4B (+70.57% YoY) → 2025F KRW 770.7B (+6.83% YoY)
- EPS: 2023A KRW 5,450 → 2024F KRW 9,296 → 2025F KRW 9,931
- PER: 2023A 28.11x → 2024F 17.17x → 2025F 16.07x
- PBR: 2023A 1.49x → 2024F 1.42x → 2025F 1.32x
- ROE: 2023A 5.50% → 2024F 8.79% → 2025F 8.65%
- BPS: 2023A KRW 103,020 → 2024F KRW 112,271 → 2025F KRW 121,080
- DPS: 2023A KRW 1,150 → 2024F KRW 1,150 → 2025F KRW 1,150
- 2Q24 Earnings Review: Consolidated Revenue of KRW 2.58T (+16% YoY, -2% QoQ), Operating Profit of KRW 208.1B (+2% YoY, +15% QoQ). Revenue beat consensus by 8% while Operating Profit met consensus. Component division saw broad-based demand growth across applications (PC, TV, appliances, server, auto) with blended ASP gains. Package Solutions revenue rose +17% QoQ beating internal guidance, driven by ARM processor BGA and server/auto FCBGA.
- 3Q24 Earnings Forecast: Projected Revenue of KRW 2.69T (+14% YoY, +4% QoQ), Operating Profit of KRW 253.5B (+38% YoY, +22% QoQ). Component revenue is projected to expand +12% QoQ led by smartphone seasonality and AI server/auto demand. Package Solutions revenue is expected to grow +11% QoQ with margin improvements as server CPU and GPU substrate shipments commence.
🚀 2. [Market Opportunities & Business Outlook]
- Component Division (MLCC): Broad demand growth across PC, TV, home appliances, server, and automotive applications. Rising industrial and automotive exposure drives blended ASP gains. Expanding from 1H AI server momentum to 2H On-Device AI content growth and high-value product demand.
- Package Substrate Division: Following a trough in 1Q24, growth is accelerating via ARM processor substrates in 2Q24 and expanding shipments of server CPU and GPU substrates to major overseas clients starting in 3Q24, driving both revenue and profitability.
- Optics & Communication Solutions: Anticipates 3Q24 revenue contraction due to earlier new product recognition by key accounts and payback from aggressive 2Q shipments by Chinese clients.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not merely through quarterly earnings beats, but as an advanced electronics hardware manufacturer demonstrating structural qualitative improvements across all business units. Supported by a fair valuation around its historical PBR band average, the core thesis highlights the expansion of AI beneficiaries—from AI servers in 1H to On-Device AI MLCCs in 2H—and the commencement of server CPU/GPU substrate shipments to overseas clients starting 3Q24, propelling 2025 operating profit past KRW 1.21T.
To evaluate whether this investment thesis progresses according to expectations, key tracking points include achieving the 3Q24 operating profit projection (KRW 253.5B, +38% YoY), progress toward the 2024/2025 operating profit forecasts (KRW 877.4B and KRW 1.216T), sustaining blended ASP gains in MLCCs driven by On-Device AI adoption, and the commercial execution of server CPU/GPU substrate deliveries. These developments can be monitored through upcoming quarterly financial announcements, official company IR presentations, and regulatory filings.
📢 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.
Contact: Compliance and Copyright Inquiries (ksb220805@gmail.com)
