[Special Stock] Samhwa Electric Soars 15%... 'AI Bubble Theory' Dissipates, Flying High

Trading at 52,700 KRW, Up 15.07%
Smiling at Increased Demand for AI Data Center S-CAP Products
AI Investment Sentiment Drives Structural Growth

Samhwa Electric is soaring by 15%. Following the 'surprise earnings' of U.S. Micron, concerns about an 'artificial intelligence (AI) bubble' have been alleviated, leading to a general rise in the stock prices of representative electric and power-related companies benefiting from AI.

As of 10:18 AM on the 26th, Samhwa Electric is trading at 52,700 KRW, up 15.07% (6,900 KRW) from the previous day. This is the first time in about a month since August 22 that Samhwa Electric's stock price has surpassed 50,000 KRW. The stock has recorded a rise of over 300% this year, ranking first in the KOSPI market's growth rate. After reaching a peak of 89,900 KRW on June 8, it has been on a downward trend, recently fluctuating between 40,000 and 50,000 KRW.

Samhwa Electric is a company that produces a single product: electrolytic capacitors. Electrolytic capacitors use electrolytes as the dielectric and the market is divided into high-end (semiconductors, automobiles, renewable energy, etc.) and low-end (TVs, home appliances, etc.) segments. Recently, it has gained attention due to the explosive demand from AI data centers.

The S-CAP (a type of electrolytic capacitor) for data centers is replacing Panasonic Japan's tantalum capacitors and is being installed in SSDs. Discussions are underway with some customers about products that can be equipped with up to nine units.

Yang Seung-su, a researcher at Meritz Securities, stated, "In 2024, sales are expected to reach 240.1 billion KRW (+18.6% YoY) and operating profit 28.8 billion KRW (+267.1% YoY). The expansion of high-value-added product sales will continue to provide positive performance momentum." He added, "Considering the change in business structure and qualitative and quantitative growth potential, this stock is expected to see a price increase based on structural growth when AI investment sentiment improves."