BNK Investment Securities analyzed on the 7th that amidst the continued strong demand for artificial intelligence (AI), delays in competitors' market entry are expected to lead to high profits in the high bandwidth memory (HBM) sector for SK Hynix. Accordingly, the investment recommendation is "buy," and the target price has been raised from 250,000 won to 310,000 won. The closing price of SK Hynix on the previous trading day was 199,800 won.
Lee Min-hee, a researcher at BNK Investment Securities, said, "Chinese smartphone OEMs have changed their inventory policies due to concerns over the U.S.-China trade conflict after the Trump administration, and mobile demand in the first half is expected to improve faster than anticipated thanks to the Chinese government's internal supply chain policies." He noted, "In the case of servers, DDR4 is experiencing slow inventory adjustments, while demand for DDR5 will remain robust."
He added, "The 128GB high-capacity module based on 32Gb monodie, which was launched later than competitors, lacks demand, while the demand is actually concentrated on the company's flagship 96GB, which is a positive factor for the server business."
This researcher projected, "Over 400 large language models (LLMs) are currently under development worldwide, and investments in AI server infrastructure seem stronger than expected," and "since TSMC raised its production plans in the second half of last year, this year's HBM demand on the company’s production volume is expected to reach twice that, indicating high profits in the HBM sector for this year as well."
He also stated, "Considering the faster-than-expected improvement in demand conditions, I am changing the lower point of memory average selling price (ASP) fluctuations from the second quarter to the first quarter this year," adding, "I have revised the earnings forecast for this year upward by 23%.”