Hana Securities on the 8th projected that Naver's artificial intelligence (AI) factory project with Nvidia will take hold as a new growth driver. It kept a "buy (BUY)" rating and raised its target price to 400,000 won from 350,000 won.
Researcher Lee Jun-ho at Hana Securities said, "The most important point in this announcement is that Naver secured growth, which had been a drag on its share price," and added, "With entry into the NeoCloud business through a partnership with Nvidia making domestic and global sales expectations possible, the company's constitution is expected to change completely."
Earlier on the 8th, Naver disclosed that it will pursue a joint global AI factory buildout with Nvidia. The company, positioning itself as the "Asia CoreWeave," plans to secure data centers and expand its business-to-business (B2B) operations to meet AI data center demand not only in Korea but also in Asia, the Middle East, and Europe. Over the long term, it aims to own data centers totaling 1 GW.
The project will proceed in four phases. First, by 2028 it will lease data centers in Korea, Malaysia, and Japan, among others, to secure 200 MW, and then expand to around 1 GW after 2030 through expansion of the Sejong data center, additional leasing, and new data center construction.
To secure the initial 200 MW of data centers, Naver and a strategic partner will each contribute 1.5 trillion won to establish a special-purpose vehicle (SPV) and raise additional funds. The researcher analyzed that the strategic partner is highly likely to be Nvidia or a client company. While estimating the investment needed for the initial 200 MW buildout at over 8 trillion won, the researcher also viewed that the project should proceed smoothly given that clients are already within sight.
However, it was assessed that Naver's mid- to long-term performance targets for the AI factory should be viewed conservatively. The company set a goal of achieving 20 trillion won in revenue and an operating margin of more than 20% five years from now through the AI factory business.
The researcher said, "Considering that CoreWeave, which operates a similar business, generates about 12 billion won in annual revenue per MW, the guidance is somewhat high," interpreting it as reflecting expectations for rising GPU costs and the expansion of ancillary services such as managed service providers (MSP). Hana Securities estimated AI factory Phase 1 revenue at 715.4 billion won in 2027 and 1.8234 trillion won in 2028, with operating profit of 107.3 billion won and 273.5 billion won, respectively.
The researcher also noted the possibility that the AI factory business could lead to a reassessment of Naver's corporate value. The researcher explained, "Leading NeoCloud corporations CoreWeave and Nevious are receiving valuations close to 20 trillion won per 1 GW of contracted power despite loss structures arising from investment execution and financing expense."
The researcher added, "Of course, NAVER's 1 GW is a target, not contracted power, and Phase 1 is 200 MW, so it is difficult to reflect that level in full in a short period," while also explaining, "New businesses such as the AI factory and digital assets can function as clear re-rating catalysts, alongside stable results in advertising and commerce."