[Click eStock] "Samsung Electro-Mechanics, Expected to Benefit Broadly from AI Expansion"

On the 26th, KB Securities forecasted that Samsung Electro-Mechanics would benefit in various ways due to the full-scale spread of artificial intelligence (AI). They maintained a 'Buy' investment rating and raised the target price from 190,000 KRW to 210,000 KRW.

Samsung Electro-Mechanics is expected to record sales of 2.44 trillion KRW and an operating profit of 174.2 billion KRW in the first quarter of this year. These figures represent increases of 21% and 24%, respectively, compared to the same period last year.

Lee Chang-min, a researcher at KB Securities, stated, "The performance improvement of multilayer ceramic capacitors (MLCC) and camera modules will stand out," adding, "This is attributed to the strong sales of the Galaxy S24 and the launch effects of new flagship smartphone models in China." He further explained, "The anticipated strengthening of the Japanese yen is also positive," noting, "Last year, due to the yen depreciation, price competition led to declines in average selling price (ASP) and market share, but recently, the easing of competitive intensity has been observed."

Lee said that Samsung Electro-Mechanics will receive long-term benefits in various ways as the AI market blossoms. He projected, "The spread of AI smartphones is expected to increase demand for high-value-added and high-performance MLCCs and the number of units installed per device," and added, "As demands for semiconductor performance improvement through back-end process enhancements grow stronger, the trend toward high-layer count and large-area packaging substrates will continue." He also noted, "From the second half of the year, supply of flip-chip ball grid array (FCBGA) for AI accelerators, which have high entry barriers, is expected, and entry into the glass substrate market after 2027 is anticipated, making it a stock to watch for AI benefits."