Brokerage : Shinhan Securities
Analyst : Hochul Lee (Senior Analyst), Minyong Eom (Analyst)
Investment Rating : BUY (Maintained)
Target Price : KRW 1,800,000 (Lowered)
Core Momentum : Despite target price downward revision factoring in wage negotiation cost burdens and peer multiple compression, mid-to-long term growth drivers remain solid backed by Rockville commercial ramp-up in 3Q and potential Plant 6 ground-breaking under BIOSECURE Act tailwinds.
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: BUY rating maintained; Target Price lowered by 5.2% to KRW 1,800,000 (29.4% upside potential vs. KRW 1,391,000 closing price).
- Valuation & Estimate Revision Basis:
- Factored in 3Q revenue deferral from strikes and medium-to-long term labor cost increases starting 2027.
- Applied lower peer group EV/EBITDA multiples.
- Annual Financial Forecast (K-IFRS Consolidated):
- 2024: Revenue KRW 3.4971 trillion, Operating Profit KRW 1.3214 trillion, Net Profit (Controlling) KRW 1.0510 trillion, P/E 94.6x, ROE 12.0%, P/B 10.7x, EV/EBITDA 41.6x.
- 2025: Revenue KRW 4.5570 trillion, Operating Profit KRW 2.0681 trillion, Net Profit (Controlling) KRW 1.5862 trillion, P/E 71.8x, ROE 19.0%, P/B 10.6x, EV/EBITDA 32.0x.
- 2026(E): Revenue KRW 5.3809 trillion, Operating Profit KRW 2.4667 trillion, Net Profit (Controlling) KRW 1.9044 trillion, P/E 35.2x, ROE 22.8%, P/B 7.2x, EV/EBITDA 23.2x.
- 2027(E): Revenue KRW 6.3958 trillion, Operating Profit KRW 2.9622 trillion, Net Profit (Controlling) KRW 2.2636 trillion, P/E 29.6x, ROE 21.6%, P/B 5.8x, EV/EBITDA 18.9x.
- 2028(E): Revenue KRW 7.1017 trillion, Operating Profit KRW 3.2972 trillion, Net Profit (Controlling) KRW 2.5244 trillion, P/E 26.6x, ROE 19.6%, P/B 4.7x, EV/EBITDA 16.6배.
🚀 2. [Market Opportunities & Business Outlook]
- 2Q26 Preview (In-line with Consensus):
- 2Q26 Revenue projected at KRW 1.3200 trillion (+30.5% YoY) and Operating Profit at KRW 607.1 billion (+27.3% YoY), matching consensus.
- Disruption of ~KRW 150 billion from the early May strike will be recognized in 3Q revenue, with volume shortfalls expected to be recovered via additional production from 4Q.
- Full-year revenue growth guidance of +15~20% maintained, supported by favorable FX tailwinds compared to 1Q.
- Facility Ramp-up & Labor Variables:
- The US Rockville site (acquired from GSK in Dec 2025) started operations in 2Q, with full commercial revenue contribution beginning in 3Q.
- Collective bargaining outcomes represent a key variable: labor cost increases are unavoidable post-settlement, and one-off bonus provisions may adjust short-term earnings estimates upon finalization.
- Mid-to-Long Term Catalysts & Geopolitical Context:
- Plant 6 in Songdo, which fundamentally reflects strong order backlog support, is scheduled for a definitive ground-breaking decision within the year.
- Following peer WuXi AppTec’s listing on the US DoD 1260H Chinese military companies list in June, the probability of designation under the BIOSECURE Act has risen, pointing to long-term market share gains amid US-China tensions.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Biologics not as an enterprise structurally impaired by temporary labor bargaining or short-term strike disruptions, but as a premier global CDMO navigating transitional labor cost headwinds while actively scaling production via Rockville and the planned Plant 6, positioned to capture significant structural demand from the US BIOSECURE Act. The perspective incorporates realistic cost increases into near-term margin forecasts while placing core emphasis on long-term capacity expansion backed by strong backlog and geopolitical tailwinds.
To verify whether this investment thesis unfolds as anticipated, key verification points include tracking the finalized wage negotiation terms and one-off provision impacts on the cost structure, observing the actual revenue ramp-up from the US Rockville facility starting in 3Q, and confirming the definitive ground-breaking decision for Songdo Plant 6 within the year alongside final US BIOSECURE Act developments. These milestones can be monitored through upcoming quarterly earnings presentations, investor relations disclosures, and official regulatory filings on DART.
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