Korea Investment & Securities identified SK hynix as the top pick in the semiconductor sector. It raised the target stock price from the previous 300,000 won to 320,000 won, and suggested a 'buy' investment opinion. On the most recent trading day, 28th, the closing price of SK hynix was 199,300 won.
On the 31st, Cha Min-sook, a Research Institute at Korea Investment & Securities, said regarding SK hynix, "This year, a high bandwidth memory (HBM) bit growth of 99%, surpassing the market average, is expected to follow last year," and noted, "Dram market share will continue to rise this year."
This year’s HBM bit growth is expected to be more than five times higher than conventional DRAM growth, and the average selling price (ASP) is also expected to be over four times higher. Cha noted, "Samsung Electronics and Micron will face difficulties supplying 5th generation HBM, HBM3e 12Hi, within the first half, so SK hynix’s dominance in the HBM market is expected to continue."
Korea Investment & Securities estimates that SK hynix's first-quarter revenue will be 17.5 trillion won, and operating profit will be 7 trillion won. Revenue is 2% higher than market consensus, and operating profit is 8% higher.
Cha noted, "The quarterly decline rate of NAND ASP is expected to be larger than anticipated, leading to a shift to a deficit," but added, "HBM3e 12Hi weight expansion and additional sales will exceed both revenue and operating profit consensus."
The HBM3e 12Hi new product was certified in the fourth quarter of last year, and full-scale mass production sales are currently underway from the first quarter of this year. As competitors Samsung Electronics and Micron have not yet entered the 12Hi market, SK hynix's dominance in the HBM market is further strengthening as major customers rush to transition from 8Hi to 12Hi.
The revenue share of HBM within DRAM is expected to exceed 40% both in the fourth quarter of last year and in the first quarter of this year. Since HBM3e 8Hi has a capacity of 24GB and 12Hi has a capacity of 36GB, the product mix shift to 12Hi could immediately yield a 50% increase in bits.
Cha added, "This is the reason that SK hynix’s HBM bit growth is expected to increase nearly 100% compared to last year without significantly increasing the silicon through via (TSV) capacity."