Market: KOSPI (000660)
Brokerage : Shinhan Investment Corp.
Analyst : Hyungtae Kim, Hyesu Song
Investment Rating : BUY (Maintained)
Target Price : 1,500,000 KRW (Upgraded)
Core Momentum : Sustained DRAM and NAND price increases amid constrained supply are expected to drive record profitability, while expanding LTAs strengthen supplier pricing power and extend earnings visibility in an excess-demand environment.
📊 1. [Valuation & Key Financial Metrics]
- Target Price / Investment Rating: 1,500,000 KRW (Upgraded) / BUY (Maintained)
- Current Price (as of April 3): 876,000 KRW (Upside potential: 71.2%)
- Market Capitalization: 624,327.3 billion KRW (Free float ratio: 75.2%)
- Key Financial Metrics (2024 / 2025 / 2026F / 2027F / 2028F):
- Revenue: 66,193.0 billion KRW / 97,146.7 billion KRW / 274,996.1 billion KRW / 374,245.4 billion KRW / 434,732.0 billion KRW
- Operating Profit: 23,467.3 billion KRW / 47,206.3 billion KRW / 201,864.2 billion KRW / 277,895.9 billion KRW / 295,008.0 billion KRW
- Net Income Attributable to Controlling Interests: 19,788.7 billion KRW / 42,919.3 billion KRW / 176,858.1 billion KRW / 231,984.8 billion KRW / 245,830.5 billion KRW
- PER: 6.4x / 11.0x / 3.5x / 2.7x / 2.5x
- PBR: 1.7x / 3.9x / 2.1x / 1.2x / 0.8x
- ROE: 31.1% / 44.2% / 85.0% / 56.5% / 38.0%
- EV/EBITDA: 3.9x / 7.7x / 2.5x / 1.3x / 0.6x
- DY: 1.3% / 0.5% / 0.5% / 0.5% / 0.5%
🚀 2. [Market Opportunities & Business Outlook]
- 1Q26 Preview: Revenue is projected at 50.4 trillion KRW (+53.5% QoQ) and operating profit at 35.5 trillion KRW (+85.1% QoQ), outperforming market consensus (46.6 trillion KRW, 31.6 trillion KRW). Divisional operating profit is expected to reach 29 trillion KRW for DRAM and 6.6 trillion KRW for NAND. Bit growth (B/G) is estimated at +0.2% for DRAM and -11.1% for NAND, while ASPs are estimated to rise by +49% and +61% respectively. Accelerated ASP growth in legacy products is expected to yield operating margins of 76% for DRAM and 56% for NAND.
- Full-Year Earnings Outlook: Full-year revenue is estimated at 275 trillion KRW (+183.1% YoY) and operating profit at 201.9 trillion KRW (+327.6% YoY), with operating profit margins for DRAM and NAND projected to set new record highs at 78.9% and 58.6% respectively.
- Supply-Demand Environment and LTAs: Limited bit growth (B/G) is expected to persist through year-end amid excess demand. As major big-tech clients materialize long-term agreement (LTA) proposals, pricing power is shifting heavily toward suppliers, potentially extending SK hynix’s leadership in HBM3E longer than anticipated.
- Mid-to-Long-Term Catalysts: Additional catalysts include a U.S. ADR listing in the second half, portfolio diversification into high-value applications (HBM4, So-CAMM, V9 NAND), and a revival of market leadership as macroeconomic uncertainties ease.
📝 Editor’s Comment (Perspective)
The analyst evaluates that as price uptrends across all DRAM and NAND products exceed expectations, the proliferation of long-term agreements (LTAs) and constrained shipment growth are strengthening supplier pricing power, driving projected annual operating profits beyond 200 trillion KRW. This perspective places greater emphasis on accelerated profitability and earnings visibility within an excess demand environment rather than short-term market fluctuations.
To determine whether this investment thesis is unfolding as projected, key items to monitor include the delivery of the projected 35.5 trillion KRW operating profit for Q1, the realization of full-year operating profit guidance of 201.9 trillion KRW, the preservation of supplier pricing power through LTAs, and the execution of the second-half ADR listing and product diversification schedules. These developments can be tracked through upcoming quarterly and annual earnings releases, official corporate IR materials, and regulatory disclosures via DART/KRX.
📢 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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