Daishin Securities said on the 5th that Hana Materials is set to see an improving operating environment as global demand for memory chips rises. The firm initiated coverage with a Buy rating and a target price of 78,000 won. Hana Materials closed the prior trading day at 53,900 won.
Ryu Hyeong-geun, an analyst at Daishin Securities, said, "Amid an unprecedented shortage in memory chip supply, capital spending and utilization rate increases by major suppliers have entered full swing," and added, "Driven by inventory build-ups of silicon parts at major domestic customers, the profit upcycle for semiconductor materials and components will continue through the end of next year."
Hana Materials' silicon parts revenue this year is expected to rise 20% on-year to 289.3 billion won, with next year's revenue up 12% to 322.3 billion won. Ryu said, "The main drivers of this year's earnings growth are a higher mix of leading-edge (high-difficulty) processes and shorter replacement cycles for parts, with DRAM leading-edge process investments underpinning demand this year, and NAND V10 investments driving growth in 2027."
An expanded overseas customer base is also expected to bolster results. Ryu said, "With supply chain stabilization as the goal, visibility is improving for order recovery from North American customers," and noted, "As semiconductor processes become more miniaturized, opportunities for greater penetration of silicon parts will continue to open."