Brokerage : Kyobo Securities
Analyst : Bo-young Choi
Investment Rating : Buy (Maintained)
Target Price : KRW 200,000 (Maintained)
Core Momentum : Supported by 90% MLCC fab utilization and lean 4-week inventory despite FX headwinds and sluggish IT set demand, positioning for a sharp earnings turnaround in 2025 upon downstream demand recovery under tight industry supply.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: Buy (Maintained) / KRW 200,000 (Maintained)
- Current Share Price (As of Sep 27, 2024): KRW 139,000
- Market Capitalization: KRW 10.57T
- Key Financial Metrics & Forecast:
- Revenue: 2023A KRW 8.91T → 2024.12E KRW 10.24T (+14.9% YoY) → 2025.12E KRW 10.91T (+6.6% YoY) → 2026.12E KRW 11.96T (+9.6% YoY)
- Operating Profit: 2023A KRW 639.0B → 2024.12E KRW 792.0B (OPM 7.7%) → 2025.12E KRW 1.07T (Table: KRW 1,068.0B, OPM 9.8%) → 2026.12E KRW 1.24T (Table: KRW 1,243.0B, OPM 10.4%)
- Net Profit: 2023A KRW 450.0B → 2024.12E KRW 607.0B → 2025.12E KRW 829.0B → 2026.12E KRW 961.0B
- EPS: 2023A 5,617 → 2024.12E KRW 7,586 (+35.1% YoY) → 2025.12E KRW 10,375 (+36.8% YoY) → 2026.12E KRW 12,034 (+16.0% YoY)
- PER: 2023A 27.3x → 2024.12E 18.3x → 2025.12E 13.4x → 2026.12E 11.6x
- PBR: 2023A 1.5x → 2024.12E 1.3x → 2025.12E 1.2x → 2026.12E 1.1x
- ROE: 2023A 5.5% → 2024.12E 7.0% → 2025.12E 9.0% → 2026.12E 9.6%
- 3Q24 Earnings Preview: Projected Revenue of KRW 2.6027T (+10.2% YoY, +2.9% QoQ), Operating Profit of KRW 221.7B (+20.5% YoY, +10.9% QoQ, OPM 8.5%), missing market consensus (Revenue KRW 2.6642T, Operating Profit KRW 247.9B). Reflects slight downward revisions to MLCC shipment volume due to general IT set softness and negative FX headwinds from a lower USD/KRW rate.
- 4Q24 Earnings Forecast: Projected Revenue of KRW 2.4795T (+7.5% YoY, -4.7% QoQ), Operating Profit of KRW 190.3B (+72.5% YoY, -14.2% QoQ, OPM 7.7%). While traditional off-season conditions and sluggish IT demand will lead to QoQ declines, robust YoY growth is expected to continue.
🚀 2. [Market Opportunities & Business Outlook]
- Component Division (MLCC): Maintained strong operations with fab utilization rising to 90%, ASP remaining flat, and inventory held at a lean ~4 weeks. Pricing remains stable as extreme Japanese Yen depreciation pressures ease, though slight downward adjustments to shipment volumes were reflected.
- Optics & Communication Solutions: Solidified position within key client flagship models and sustained automotive expansion, though affected by weak smartphone shipments and slower EV sales.
- Package Solution Division: Continues to operate at low fab utilization rates due to prolonged IT weakness and industry oversupply in FC-BGA.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not through the lens of a near-term consensus miss in 3Q24 caused by slower IT demand and FX headwinds, but as an advanced electronics hardware manufacturer strengthening its underlying operational health through 90% MLCC fab utilization and lean 4-week inventory levels. The investment thesis places greater weight on the structural earnings leverage potential (projected full-year 2025 operating profit reaching KRW 1.07T) when downstream IT demand rebounds amidst industry-wide supply constraints.
To verify whether this investment thesis unfolds as anticipated, key tracking points include achieving the full-year 2025 operating profit forecast (KRW 1.068T), sustaining 90% MLCC fab utilization and ~4-week inventory levels past the 4Q off-season, pricing stability in MLCCs amid Yen stabilization, utilization recovery in FC-BGA substrates as oversupply eases, and the magnitude of operating leverage upon broader IT demand recovery. These factors can be monitored through upcoming quarterly financial disclosures, 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.
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