Market: KOSPI (000660)
Brokerage : DS Investment & Securities
Analyst : Surim Lee, Jinyoung Kim
Investment Rating : BUY (Maintain)
Target Price : KRW 290,000 (Maintain)
Core Momentum : Annual operating profit estimates for 2025 are revised upward based on a faster-than-expected recovery in DRAM market conditions and product mix improvements driven by HBM3e 12-high shipments surpassing 50% in 2Q25.
📊 1. [Valuation & Key Financial Metrics]
- Stock Price & Target Price: Current Price (4/24) KRW 178,300, Target Price KRW 290,000 (Maintained), Upside Potential 62.6%
- Market Cap & Supply Metrics: Market Capitalization KRW 129.803 trillion, Total Shares Outstanding 728,002 thousand, Foreign Ownership 53.3%
- Key Financial Projections (K-IFRS Consolidated):
- 2025F Revenue: KRW 83.996 trillion, Operating Profit: KRW 37.267 trillion (Upgraded from KRW 36.4 trillion), Net Income Attributable to Shareholders: KRW 27.639 trillion (EPS: KRW 37,965, Growth: 55.1%)
- 2026F Revenue: KRW 93.619 trillion, Operating Profit: KRW 41.343 trillion, Net Income Attributable to Shareholders: KRW 30.796 trillion (EPS: KRW 42,302, Growth: 11.4%)
- Valuation & Financial Metrics:
- 2025F: P/E 4.7x, P/B 1.3x, EV/EBITDA 2.6x, ROE 32.9%, Operating Margin 44.4%
- 2026F: P/E 4.2x, P/B 1.0x, EV/EBITDA 1.9x, ROE 27.4%, Operating Margin 44.2%
🚀 2. [Market Opportunities & Business Outlook]
- 1Q25 Earnings Review: Revenue reached KRW 17.6 trillion (-11% QoQ) and operating profit KRW 7.4 trillion (-8% QoQ, OPM 42%), beating both the company’s estimates (KRW 6.9 trillion) and market consensus (KRW 6.6 trillion).
- DRAM & NAND Performance: DRAM experienced a faster-than-expected market turnaround with bit growth of -8% and flat ASP, supported by subsidies for trade-in programs, set demand growth, and inventory restocking. NAND recorded bit growth of -19% and ASP decline of -21% to defend profitability. 1Q25 HBM revenue is estimated at KRW 6.6 trillion (+5% QoQ).
- 2Q25 Preview: Revenue is projected at KRW 20.1 trillion (+14% QoQ) and operating profit at KRW 8.9 trillion (+19% QoQ, OPM 44%), sustaining strong operating performance.
- Growth Drivers & CapEx: Robust AI server demand and customer pull-in demand ahead of potential tariffs continue. Starting in 2Q25, HBM3e 12-high will account for over 50% of HBM3e shipments, accelerating mix improvements. Key operational milestones include the 1b DRAM conversion and new investments in M15X this year, followed by meaningful mass production of 1c DRAM next year.
📝 Editor’s Comment (Perspective)
The analyst evaluates SK hynix as a market leader demonstrating structural earnings resilience via HBM contributions despite broader concerns over conventional memory cycle slowdowns. The perspective places greater weight on robust underlying fundamentals and clear earnings visibility driven by 12-high product mix improvements rather than short-term macro concerns or hardware architecture changes.
To determine whether this investment thesis is actually playing out, investors should closely monitor whether the shipment proportion of HBM3e 12-high exceeds 50% in 2Q25, whether 2Q operating profit reaches the projected KRW 8.9 trillion, and whether advanced process transitions—such as the 1b DRAM migration and M15X investments—proceed according to schedule. These developments can be verified through upcoming quarterly earnings releases, official IR materials, and regulatory filings.
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Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
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