Brokerage : Yuanta Securities
Analyst : Anna Lee
Investment Rating : BUY (Maintained)
Target Price : KRW 190,000 (Maintained)
Core Momentum : Sustaining mid-to-long term structural growth driven by high-end MLCC demand resilience and expanding FC-BGA exposure across AI servers and automotive applications despite 4Q seasonal destocking.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / KRW 190,000 (Maintained)
- Current Share Price (As of Oct 29, 2024): KRW 120,200 (Upside potential: 58%)
- Market Capitalization: KRW 9.15T
- Key Financial Metrics & Forecast:
- Revenue: 2023A KRW 8.91T → 2024F KRW 10.20T → 2025F KRW 10.995T
- Operating Profit: 2023A KRW 639.0B → 2024F KRW 778.0B (OPM 7.6%) → 2025F KRW 990.0B (OPM 9.0%)
- Net Profit (Controlling): 2023A KRW 423.0B → 2024F KRW 565.0B → 2025F KRW 666.0B
- PER: 2023A 25.8x → 2024F 16.0x → 2025F 13.6x
- PBR: 2023A 1.4x → 2024F 1.0x → 2025F 0.9x
- ROE: 2023A 5.5% → 2024F 6.8% → 2025F 7.2%
- Dividend Yield: 0.75%
- 3Q24 Earnings Review: Consolidated Revenue of KRW 2.615T (Text: ~KRW 2.6T, +10.8% YoY, +1.4% QoQ), Operating Profit of KRW 224.9B (Table: KRW 225.0B, +22.2% YoY, +8.1% QoQ, OPM 8.6%), slightly missing consensus (Operating Profit KRW 236.2B). Component division recorded KRW 1.2T on automotive/industrial volume and ASP gains; Package Solutions posted KRW 558.2B on server/automotive high-end demand; Optics Solutions generated KRW 860.1B impacted by Chinese low-end launches and reduced overseas IT client shipments.
- 4Q24 Earnings Forecast: Projected Revenue of KRW 2.40T (+3% YoY, -9% QoQ), Operating Profit of KRW 164.2B (+49% YoY, -27% QoQ, OPM 7%). Anticipates QoQ top-line contraction across divisions due to IT/industrial MLCC destocking despite expected growth in automotive demand, lower optical shipments, and off-season substrate adjustments.
🚀 2. [Market Opportunities & Business Outlook]
- Component Division (MLCC): 3Q24 revenue reached KRW 1.2T (+9% YoY, +3% QoQ). Despite expected growth in automotive demand, 4Q destocking is anticipated in IT and industrial MLCC applications, though structural demand growth for high-specification MLCCs remains intact.
- Package Solution Division: 3Q24 revenue posted KRW 558.2B (+27% YoY, +12% QoQ). Structural growth is underpinned by rising FC-BGA demand for AI servers and long-term automotive applications.
- Optics Solution Division: 3Q24 revenue recorded KRW 860.1B (+4% YoY, -7% QoQ). Mass production of high-end camera modules for strategic flagship customers was offset by low-end focus in the Chinese market and reduced shipments to overseas clients.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not through near-term quarterly fluctuations and 4Q seasonal destocking, but as an advanced electronics hardware manufacturer positioned for mid-to-long term qualitative expansion. The central investment thesis highlights ongoing top-line resilience in high-spec MLCCs alongside strengthening demand for AI server and automotive FC-BGA substrates as key pillars supporting mid-to-long term growth.
To evaluate whether this investment thesis unfolds as anticipated, key tracking points include the completion of 4Q customer inventory adjustments, progress toward the 2025 operating profit forecast (KRW 990.0B), sustained ASP improvement in high-spec MLCCs, and tangible order expansion in FC-BGA substrates for AI servers and automotive platforms. 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.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
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