Brokerage : Mirae Asset Securities
Analyst : Jun-seo Park
Investment Rating : BUY (Maintained)
Target Price : KRW 190,000 (Maintained)
Core Momentum : Rising adoption of high-value components across AI devices, servers, and automotive applications is projected to drive blended ASP expansion and support steady earnings recovery into the second half.
📊 1. [Valuation & Key Financial Metrics]
- Target Price & Rating: Target Price maintained at KRW 190,000, Rating maintained at BUY
- Stock Data (As of April 29, 2024): Current Price KRW 151,300, Market Capitalization KRW 11.30 Trillion, Foreign Ownership 31.5%
- Key Financial Forecasts (2023 → 2024F → 2025F):
- Revenue: KRW 8.91 Trillion → KRW 9.96 Trillion → KRW 10.50 Trillion
- Operating Profit: KRW 639.0 Billion → KRW 829.0 Billion → KRW 993.0 Billion
- Net Profit (Controlling): KRW 423.0 Billion → KRW 670.0 Billion → KRW 766.0 Billion
- EPS: KRW 5,450 → KRW 8,635 → KRW 9,876 (2024F EPS Growth: 58.4%)
- PER / PBR: 28.1x / 1.5x → 17.5x / 1.4x → 15.3x / 1.3x
- ROE: 5.5% → 8.2% → 8.7%
🚀 2. [Market Opportunities & Business Outlook]
- Q1 2024 Earnings Review:
- Consolidated revenue reached KRW 2.62 Trillion (+29.8% YoY) and operating profit stood at KRW 180.3 Billion (+29.0% YoY), beating consensus estimates (KRW 171.3 Billion).
- Growth was supported by expanded shipments of industrial MLCCs for AI servers and power modules, robust hybrid/ADAS automotive demand, and high-spec 200M/folded-zoom camera module deliveries.
- Package substrate earnings declined QoQ due to softer AP substrate demand despite ARM processor substrate expansion.
- Q2 2024 Outlook & Drivers:
- Q2 2024 revenue is forecast at KRW 2.32 Trillion (+4.4% YoY) and operating profit at KRW 212.8 Billion (+3.8% YoY).
- Despite seasonal softness in Optics & Communication (revenue -35% QoQ), Component division volume (+5.6% QoQ) and pricing (+3.0% QoQ) expansion are projected to drive operating profit above consensus.
- AI & Automotive Structural Growth:
- MLCC capacitance requirements are rising significantly: AI servers (+2–3x vs. legacy servers), AI smartphones (+8%), and AI PCs (+50%).
- High-value product mix expansion into ADAS and EV powertrains supports ongoing blended ASP improvement.
- Substrate division is positioned for recovery in H2 as channel inventory destocking concludes.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not merely as a cyclical commodity parts supplier, but as a high-value hardware provider driving structural blended ASP expansion through an enriched portfolio focused on AI infrastructure (servers, PCs, smartphones) and automotive electronics (ADAS, powertrain). The overarching perspective places greater significance on the margin-accretive impact of rising component density and the conclusion of channel destocking than on short-term seasonal softness in mobile camera modules.
To assess the progression of this investment thesis moving forward, verification should focus on whether the Component division delivers simultaneous volume and pricing expansion in Q2, whether blended ASP continues to trend upward via high-capacitance AI and automotive MLCC shipments, and whether the package substrate division confirms a tangible rebound in H2 as inventory normalization takes hold. These operational developments can be monitored through upcoming quarterly financial announcements, investor relations materials, and periodic regulatory filings.
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