Market: KOSPI (000660)
Brokerage : Hanwha Investment & Securities
Analyst : Kwang-jin Kim
Investment Rating : BUY (Maintained)
Target Price : KRW 250,000 (Downgraded)
Core Momentum : Earnings defensiveness and downside stock support driven by unrivaled HBM market leadership and shipment expansion, offsetting downward earnings revisions and sluggish traditional demand
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / Target Price: KRW 250,000 (Downgraded from KRW 260,000 by -4%) / Upside potential: 41.2% based on the base share price of KRW 177,100 (2024-11-26)
- Financial Performance & Forecasts:
- 2022: Revenue KRW 44.62 Trillion, Operating Profit KRW 6.81 Trillion, Controlling Net Profit KRW 2.23 Trillion
- 2023: Revenue KRW 32.77 Trillion, Operating Profit -KRW 7.73 Trillion, Controlling Net Profit -KRW 9.11 Trillion
- 2024(E): Revenue KRW 65.80 Trillion, Operating Profit KRW 23.27 Trillion, Controlling Net Profit KRW 17.90 Trillion
- 2025(E): Revenue KRW 77.89 Trillion, Operating Profit KRW 29.05 Trillion, Controlling Net Profit KRW 21.63 Trillion
- Valuation Multiples (2022 → 2023 → 2024E → 2025E):
- EPS: KRW 3,063 → -KRW 12,517 → KRW 26,012 → KRW 31,433
- PER: 24.5x → N/A → 6.8x → 5.6x
- PBR: 0.9x → 1.9x → 1.8x → 1.4x
- EV/EBITDA: 3.5x → 21.7x → 4.1x → 3.1x
- ROE: 3.6% → -15.6% → 28.6% → 26.4%
🚀 2. [Market Opportunities & Business Outlook]
- Short-term & Annual Earnings Adjustments:
- 4Q24 Outlook: Operating profit revised down slightly from KRW 8.1 Trillion to KRW 7.9 Trillion. Shipment growth maintained at DRAM +7% and NAND +12%, but price outlooks adjusted downward (previous: DRAM +8%, NAND -5% → revised: DRAM +5%, NAND -1%) to reflect deeper-than-expected weakness in traditional demand sectors like mobile and PC.
- Next Year’s Earnings Outlook: 2025 operating profit estimate revised down from KRW 31.7 Trillion to KRW 29.1 Trillion amid intensifying demand polarization between AI and traditional applications.
- HBM Market Dominance & Competitiveness:
- Backed by robust AI server demand, SK hynix is expected to maintain a virtually monopolistic position in the 12-high HBM market, capturing pricing premiums independently.
- Next-year HBM shipments are projected to surge by approximately +77% YoY to 12.9 billion Gb (compared to 7.3 billion Gb this year), with profit contribution approaching nearly 50%.
- Defensive Logic Amid Pricing Pressure:
- While pricing pressures for DRAM (from 3Q25) and NAND (from 1Q25) could emerge if general demand fails to recover, HBM prices and quantities are locked in via order-based contracts, cementing its market leadership as a core rationale for stock price defense.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix not as a generic memory supplier fully exposed to sluggish traditional IT demand and downward pricing cycles, but as a leading AI memory player capable of offsetting down-cycle concerns and preserving earnings robustness through unmatched HBM technological leadership and order-backed price stability. Greater emphasis is placed on the structural defensiveness provided by its monopolistic position in premium HBM and high profit contribution rather than short-term earnings estimate cuts driven by legacy weakness.
To assess whether this investment thesis unfolds as anticipated, key verification points include whether year-end inventory clearance sales materialize smoothly amid sluggish traditional demand, the sustainability of pricing premiums and near-monopoly supply in 12-high HBM markets, and whether the projected +77% surge in capacity-based HBM shipments actually translates into an approaching 50% profit contribution. These developments can be verified through future quarterly earnings releases, official company IR materials, DART/KRX filings, and regular financial reports.
📢 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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