Brokerage : IBK Securities
Analyst : Un-oh Kim
Investment Rating : BUY (Maintained)
Target Price : KRW 190,000 (Maintained)
Core Momentum : Steady expansion of non-IT MLCC share, new customer acquisitions, and substrate growth driven by server, network, and automotive demand are expected to sustain earnings momentum through Q3.
📊 1. [Valuation & Key Financial Metrics]
- Target Price & Rating: Target Price maintained at KRW 190,000, Rating maintained at BUY
- Stock Data (As of July 31, 2024): Share Price KRW 159,600, Market Capitalization KRW 12.13 Trillion, Foreign Ownership 34.8%
- Key Financial Forecasts (2023 → 2024F → 2025F):
- Revenue: KRW 8.91 Trillion → KRW 10.42 Trillion → KRW 11.70 Trillion
- Operating Profit: KRW 639.0 Billion → KRW 836.0 Billion → KRW 1.01 Trillion
- Net Profit (Controlling): KRW 423.0 Billion → KRW 670.0 Billion → KRW 822.0 Billion
- EPS: KRW 5,450 → KRW 8,636 → KRW 10,597 (YoY Growth: -56.9% → +58.5% → +22.7%)
- PER / PBR: 28.1x / 1.5x → 18.5x / 1.5x → 15.1x / 1.3x
- Operating Margin: 7.2% → 8.0% → 8.6%
- ROE: 5.5% → 8.2% → 9.3%
🚀 2. [Market Opportunities & Business Outlook]
- Q2 2024 Performance Review:
- Consolidated revenue stood at KRW 2.58 Trillion (-1.7% QoQ), while operating profit rose to KRW 208.1 Billion (+15.5% QoQ), meeting market expectations.
- Excluding Optics & Communication, major divisions (Component and Package Solution) saw revenue grow by approximately 15% QoQ, driven by balanced demand across IT, industrial, and automotive segments.
- Profitability across key units improved on higher capacity utilization and favorable product mix.
- Q3 2024 Outlook:
- Revenue is forecast at KRW 2.69 Trillion (+4.1% QoQ) and operating profit at KRW 244.1 Billion (+17.3% QoQ).
- Segment revenue growth will be led by Component (+12.3% QoQ) and Package Solution (+12.3% QoQ), offsetting a projected 10.8% QoQ decline in Optics & Communication.
- Margin improvement outside of the camera module division is expected to continue driving overall earnings expansion.
- Structural Growth Drivers:
- The non-IT portion within MLCC continues to increase steadily, with ongoing diversification into new client accounts securing long-term growth stability.
- The Package Solution division is offsetting soft general IT demand through high-value shipments for servers, networking equipment, and automotive applications.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not merely as an IT cycle-dependent hardware vendor, but as a stabilizing business building medium- to long-term earnings resilience through an expanding non-IT MLCC presence and advanced substrate diversification. The overarching perspective places greater significance on product mix optimization and client expansion across Component and Package Solution units than on short-term softness in optical communications.
To evaluate the ongoing validity of this investment thesis, verification should center on whether Q3 revenue for both Component and Package Solution divisions achieves the targeted ~12% QoQ expansion, whether non-IT revenue share within MLCC continues its structural upward trend alongside new client onboarding, and whether substrate profitability offsets broader IT consumer market sluggishness. These developments can be monitored through future quarterly earnings announcements, official IR materials, and regulatory filings.
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Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
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