Market: KOSPI (000660)
Brokerage : Hanwha Investment & Securities
Analyst : Kwang-jin Kim (RA Yeong-ju Choi)
Investment Rating : BUY (Maintained)
Target Price : KRW 280,000 (Upgraded)
Core Momentum : Sustained competitive advantage from a near-monopoly in HBM3E, strong HBM revenue growth (KRW 10.9T in 2024 / KRW 19.6T in 2025), TSMC partnership for custom HBM4, and Solidigm reaching full fab utilization
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY (Maintained) / Target Price: KRW 280,000 (Upgraded by +33% from KRW 210,000) / Base Share Price (2024-06-18): KRW 234,500 (Upside potential: 19.4%) / Market Cap: KRW 170.72 Trillion
- Target Price Valuation Logic:
- Full-year operating profit forecasts for 2024 and 2025 revised upward from KRW 17.6 Trillion and KRW 22.2 Trillion to KRW 21.0 Trillion (table indicates KRW 21.041 Trillion) and KRW 29.7 Trillion (table indicates KRW 29.722 Trillion), respectively.
- Valuation target BPS changed from 2024E BPS to the 2024–2025 average BPS, applying a Target P/B multiple of 2.5x (a 25% premium to historical P/B band upper end).
- Target price reflects enhanced earnings visibility and sustained leadership in the AI cycle.
- 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 65.96 Trillion, Operating Profit KRW 21.04 Trillion (KRW 21.0 Trillion in text), Controlling Net Profit KRW 15.76 Trillion
- 2025(E): Revenue KRW 83.31 Trillion, Operating Profit KRW 29.72 Trillion (KRW 29.7 Trillion in text), Controlling Net Profit KRW 21.38 Trillion
- Valuation Multiples (2022 → 2023 → 2024E → 2025E):
- EPS: KRW 3,063 → -KRW 12,517 → KRW 22,904 → KRW 31,065
- PER: 24.5x → -11.3x → 10.2x → 7.5x
- PBR: 0.9x → 1.9x → 2.4x → 1.9x
- EV/EBITDA: 3.5x → 21.7x → 5.6x → 4.1x
- ROE: 3.6% → -15.6% → 25.6% → 26.8%
- Net Debt: KRW 19.39 Trillion → KRW 25.82 Trillion → KRW 21.94 Trillion → KRW 7.62 Trillion
🚀 2. [Market Opportunities & Business Outlook]
- HBM Market Leadership & Strategic Initiatives:
- HBM3E Monopolistic Position: Competitors’ penetration into HBM3E remains delayed, enabling SK hynix to maintain an effective monopoly and fully capture pricing benefits from generational transitions.
- HBM Revenue Trajectory: Projected to surge from KRW 2.6 Trillion in 2023 to KRW 10.9 Trillion in 2024, reaching KRW 19.6 Trillion in 2025.
- Custom HBM4 Development: Preparing custom HBM4 featuring customized logic dies in partnership with TSMC, targeting late 2025 readiness. The collaboration with TSMC creates strong competitive barriers that will make it difficult for competitors to narrow the technology gap.
- 2Q24 Earnings Preview:
- Consolidated Forecast: Revenue projected at KRW 15.6 Trillion (+26% QoQ) and Operating Profit at KRW 4.9 Trillion (+69% QoQ).
- DRAM Segment: Bit growth +16% QoQ, Blended ASP +13% QoQ. Driven by product mix enhancement with HBM’s share of DRAM revenue estimated in the upper-10% range.
- NAND Segment: Bit growth +2% QoQ, Blended ASP +14% QoQ. Supported by surging QLC eSSD demand, Solidigm is entering full fab utilization, significantly boosting profitability.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix not as a vendor facing immediate competitive erosion, but as the dominant AI memory leader that continues to capture generational pricing premiums through a near-monopoly in HBM3E while widening its technology moat via custom HBM4 partnerships with TSMC. Greater weight is attached to structural revenue scaling in HBM (KRW 10.9 Trillion in 2024 and KRW 19.6 Trillion in 2025) and Solidigm’s transition to full utilization rather than near-term valuation multiple concerns.
To assess whether this investment thesis unfolds as anticipated, key verification points include achieving 2Q24 operating profit of KRW 4.9 Trillion, tracking full-year HBM revenue toward the KRW 10.9 Trillion target, verifying sustained full fab utilization at Solidigm driven by QLC eSSD demand, and monitoring progress in the TSMC partnership targeting custom HBM4 readiness by late 2025. These developments can be verified through future quarterly earnings releases, official company IR materials, DART/KRX filings, and regular financial statements.
📢 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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