Hana Securities on the 26th said Samsung Electro-Mechanics' overall results are growing on the back of a rising share of sales from artificial intelligence (AI) servers, while the supply of parts for Humanoid Robot applications will serve as a mid- to long-term momentum driver. It maintained a "buy" recommendation and raised its target price to 340,000 won from 310,000 won.
Kim Min-gyeong, an analyst at Hana Securities, said, "It appears the supply-demand environment for multilayer ceramic capacitors (MLCC) is gradually tightening, as some mobile customers have recently shifted from quarterly contracts to annual contracts," and noted, "In particular, given the surge in MLCC content in next-generation AI accelerator-based server racks, the tight supply-demand situation in the second half is likely to intensify further."
Kim added, "There was a temporary share-price correction on disappointment over recent MLCC pricing trends, but considering the second-half supply-demand environment, this could be a buying opportunity," and noted, "With Murata's earnings announcement scheduled for Aug. 2, market expectations could rebuild depending on comments related to MLCC utilization rates, inventory levels, and supply-demand."
Kim projected Samsung Electro-Mechanics will post 12.9375 trillion won in revenue and 1.3154 trillion won in operating profit this year. Those would be increases of 14% and 44%, respectively, with the operating margin expected to top 10%. The analysis is that the share of AI servers will expand in the components and package solutions institutional sector, and the supply of parts for Humanoid Robot applications will act as a new growth driver.
Kim said, "Driven by the proliferation of server rack architectures, MLCC adoption will increase, and solid automotive demand will push the average annual utilization rate above 90%," and projected, "FCBGA, too, will effectively run at full capacity from the second half, backed by rising server CPU demand and the addition of new AI server customers."
Kim went on, "A decision on additional capacity expansion to meet server-bound FCBGA demand is highly likely within the first half, with mass-production contributions set to ramp up in late 2028," and explained, "In the optical solutions institutional sector, full-fledged supply of camera modules for Humanoid Robot applications is expected to begin in the first half."