Brokerage : Daishin Securities
Analyst : Kang-ho Park, Ji-won Seo (RA)
Investment Rating : BUY (Maintained)
Target Price : KRW 330,000 (Maintained)
Core Momentum : Projected record-high earnings and ongoing valuation re-rating driven by a portfolio shift toward AI infrastructure/automotive components and expanding supply to global Big Tech customers.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained), 6-month Target Price of KRW 330,000 (Maintained), derived by applying a target P/E of 26.7x (the upper band of historical earnings expansion periods) to the 2026 EPS forecast.
- Base Share Price (As of Dec 22, 2025): KRW 254,500 (Market Cap: KRW 19.35 Trillion, KOSPI Weight: 0.58%)
- Valuation Multiples & Trend:
- P/E: 2024: 14.1x → 2025(E): 29.5x → 2026(E): 20.5x → 2027(E): 18.0x
- P/B: 2024: 1.1x → 2025(E): 2.1x → 2026(E): 1.9x → 2027(E): 1.8x
- BPS: 2024: KRW 113,261 → 2025(E): KRW 120,340 → 2026(E): KRW 131,208 → 2027(E): KRW 143,751
- ROE: 2024: 8.2% → 2025(E): 7.3% → 2026(E): 9.8% → 2027(E): 10.2%
- Earnings Forecast Summary:
- 2025(E): Revenue KRW 11.26 Trillion, Operating Profit KRW 906.0 Billion (OPM 8.0%), Net Profit (Controlling) KRW 665.0 Billion, EPS KRW 8,574.
- 2026(E): Revenue KRW 12.32 Trillion (+9.3% YoY), Operating Profit KRW 1.19 Trillion (+30.9% YoY, OPM 9.6%), Net Profit (Controlling) KRW 959.0 Billion (+44.2% YoY), EPS KRW 12,358 (Revenue revised up by +0.5%, Operating Profit by +3.8%).
- 2027(E): Revenue KRW 13.44 Trillion, Operating Profit KRW 1.39 Trillion (OPM 10.4%), Net Profit (Controlling) KRW 1.09 Trillion, EPS KRW 14,028.
🚀 2. [Market Opportunities & Business Outlook]
- Portfolio Transition Toward AI Infrastructure & Automotive Solutions:
- Transitioning from reliance on legacy consumer IT set demand to revenue driven by AI infrastructure, data centers, and automotive electronic components.
- FC-BGA: Increasing supply to global Big Tech helped FC-BGA surpass 50% of the Substrate Solutions division sales in Q3 2025. 2026 FC-BGA revenue is expected to grow 20% YoY, supported by expanding ASIC customer diversification (including AMD and Amazon).
- MLCC: Industrial and automotive segments already account for over 50% of MLCC sales. Growth expected from AI infrastructure investments, vehicle electrification, and autonomous driving adoption, supporting market share expansion.
- Supply Chain Expansion with Global Strategic Customers:
- Apple: High likelihood of newly supplying Fine Pitch (FP) coils for camera actuators via joint venture (Stemco) in H2 2026, with potential future supply diversification into actuators and folded zoom camera modules.
- Tesla: Estimated at ~9–10% of total revenue in 2025. Supplying FC-BGA, MLCCs, and camera modules. Additional growth opportunities include FC-BGA supply for autonomous driving chips (AI4/AI5), higher MLCC content per robotaxi, and component cooperation for SpaceX and humanoid robotics (Optimus).
📝 Editor’s Comment (Perspective)
The covering analyst views Samsung Electro-Mechanics as a company transitioning its business portfolio away from consumer IT device cycles toward AI infrastructure and automotive applications. The core perspective emphasizes that revenue expansion in FC-BGA and automotive/industrial MLCCs, combined with expanding component supply to global Big Tech leaders (such as Apple and Tesla), will drive record-high earnings and valuation multiple expansion in 2026.
To verify whether this investment thesis materializes, key checkpoints include: 1) achieving the projected 20% YoY revenue growth in FC-BGA alongside tangible expansion into new ASIC clients; 2) the commercialization and supply commencement of Fine Pitch (FP) coils to Apple starting in H2 2026; and 3) the actual revenue reflection of expanded component shipments to Tesla, including autonomous driving chip substrates (AI4/AI5) and new business lines. These variables can be tracked through future quarterly earnings releases, official IR materials, regulatory filings, and corporate disclosures.
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