Market: KOSPI (000660)
Brokerage : Shinhan Securities
Analyst : Hyungtae Kim (Researcher: Hyesus Song)
Investment Rating : BUY (Maintained)
Target Price : 730,000 KRW (Raised)
Core Momentum : Broad-based memory demand growth and constrained supply are expected to intensify shortages across DRAM and NAND, strengthening supplier pricing power and supporting a prolonged memory super-cycle with greater earnings visibility.
📊 1. [Valuation & Key Financial Metrics]
- Target Price: 730,000 KRW (Based on a Target PBR of 3.0x applied to 2026F BPS of 242,782 KRW, Raised)
- Investment Rating: BUY (Maintained)
- 2025F / 2026F Financial Outlook: 2025 Revenue 91.58 trillion KRW, Operating Profit 41.45 trillion KRW, Net Income 47.24 trillion KRW / 2026 Revenue 126.12 trillion KRW, Operating Profit 64.74 trillion KRW, Net Income 55.94 trillion KRW
- Valuation Multiples: PER 8.6x, PBR 3.4x, EV/EBITDA 7.0x, ROE 48.4% (2025F) / PER 7.3x, PBR 2.3x, EV/EBITDA 4.4x, ROE 37.6% (2026F)
🚀 2. [Market Opportunities & Business Outlook]
- 3Q25 Review: Revenue reached 24.4 trillion KRW (+10% QoQ) and operating profit 11.4 trillion KRW (24% QoQ), meeting market consensus. Estimated DRAM metrics: B/G +8%, ASP +5%, OPM 60%. High-capacity shipments doubled QoQ, with graphics (HBM) accounting for 42%. Estimated NAND metrics: B/G -5%, ASP +11%; net income showed a divergence due to the expansion of high-capacity eSSD sales and a 3.3 trillion KRW investment asset valuation gain driven by Kioxia’s share price surge.
- 4Q25 Preview: Revenue is expected to reach 27.3 trillion KRW and operating profit 13.4 trillion KRW, pointing to a renewed record-breaking performance. QoQ B/G is expected to be flat for DRAM and +3% for NAND. Sustained conversion investments and conservative supply stances lead to a full-scale price hike phase (DRAM +8%, NAND +10%). DDR5 experiences severe supply tightness with shipments occurring simultaneously with production, while generic memory customers accelerate pre-orders amidst discussions regarding Long-Term Agreements (LTAs).
- Industry Outlook: Entry into a super-cycle driven by exploding demand across all memory products. HBM4 supply negotiations with key clients are finalized, maintaining CapEx focus on HBM capacity expansion and conversion investments. Historical double-booking and inventory build-up patterns seen in past oversupply periods are unlikely to materialize due to supply constraints and robust underlying demand.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix as entering a memory super-cycle fueled by robust demand across all memory products and supplier pricing dominance, successfully securing differentiated profitability and reliable earnings visibility.
To verify this investment thesis, one should track whether 4Q25 targets (revenue of 27.3 trillion KRW, operating profit of 13.4 trillion KRW) are met, if the price hike cycle (DRAM +8%, NAND +10%) translates into actual financial outcomes, and how LTA negotiations affect supply-demand stability. These indicators can be monitored through upcoming quarterly reports and regulatory filings via DART.
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