Brokerage : Hana Securities
Analyst : Rok-ho Kim, Young-gyu Kim
Investment Rating : BUY (Maintained)
Target Price : KRW 200,000 (Maintained)
Core Momentum : Comprehensive product mix enrichment driven by rising demand for AI server/automotive MLCCs and high-end FC-BGA substrates is projected to create steady quarterly earnings upside potential.
📊 1. [Valuation & Key Financial Metrics]
- Target Price & Rating: 12-Month Target Price maintained at KRW 200,000, Rating maintained at BUY
- Stock Data (As of April 29, 2024): Current Price KRW 151,300, Market Capitalization KRW 11.30 Trillion, Foreign Ownership 31.49%
- Key Financial Forecasts (2023 → 2024F):
- Revenue: KRW 8.91 Trillion → KRW 10.34 Trillion
- Operating Profit: KRW 639.4 Billion → KRW 917.7 Billion
- Net Profit: KRW 423.0 Billion → KRW 728.3 Billion
- EPS: KRW 5,450 → KRW 9,386 (YoY: -56.87% → +72.22%)
- BPS: KRW 103,020 → KRW 111,284
- PER / PBR: 28.11x / 1.49x → 16.12x / 1.36x
- ROE: 5.50% → 8.92%
🚀 2. [Market Opportunities & Business Outlook]
- Q1 2024 Performance Review:
- Consolidated revenue reached KRW 2.62 Trillion (+30% YoY, +14% QoQ) and operating profit stood at KRW 180.3 Billion (+29% YoY, +63% QoQ).
- Component: Surpassed KRW 1 Trillion in quarterly sales on higher blended ASP driven by AI server, power module, and automotive demand.
- Optics & Communication: Revenue surged +47% YoY supported by flagship 200M pixel and slim folded-zoom module adoption alongside solid North American EV camera shipments.
- Package Solution: Maintained solid growth in ARM processor and automotive (ADAS/autonomous) substrates despite overall PC/mobile softness.
- Q2 2024 Outlook:
- Consolidated revenue forecast at KRW 2.38 Trillion (+7% YoY, -9% QoQ) and operating profit at KRW 213.4 Billion (+4% YoY, +18% QoQ).
- Component division to sustain mix improvements led by expanding AI server contribution.
- Package Solution division to benefit from volume recovery in PC/server FC-BGA and memory substrates.
- Structural Catalysts & Mix Upgrades:
- Full-year product mix enhancement across all divisions driven by secular high-end demand.
- Package Solution division poised for accelerated growth in Q3 as demand for high-performance AI accelerator substrates ramps up alongside server CPU recovery.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not as an electronic component maker vulnerable to broad IT hardware volume cycles, but as a diversified supplier undergoing synchronized product mix enrichment powered by high-value AI server MLCCs and advanced package substrates. The overarching perspective places greater significance on the margin-accretive impact of high-end AI server and automotive components than on short-term baseline consumer demand trends.
To assess the progression of this investment thesis moving forward, verification should focus on whether blended ASP and margins within the Component division remain elevated via AI server demand, whether commercial shipments of high-performance AI accelerator substrates ramp up as expected in Q3, and whether full-year operating profit tracks toward the KRW 900+ Billion level. These milestones can be monitored through upcoming quarterly financial announcements, investor relations materials, and periodic regulatory filings.
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