NH Investment & Securities on the 22nd said that as SK hynix's share price continues to rise, SK Square will keep gaining favor, especially among investors who want high returns by maximizing the share of semiconductors in their investment assets. It maintained a Buy rating and raised the target price to 2.7 million won from 1.1 million won.
SK hynix's rising share price—a dominant portion of SK Square's net worth (NAV)—remains on an upward trend.
An Jae-min of NH Investment & Securities said, "Along with demand from investors who want high returns by maximizing the share of semiconductors in their investment assets, SK Square's corporate value is rising in tandem," adding, "With that in mind, we applied SK hynix's target price to the value of SK hynix used in SK Square's NAV to derive this target price."
NH Investment & Securities said the semiconductor supercycle is unlikely to break in the short term, and as a result, SK hynix's share price is expected to rise. It also saw SK Square's corporate value increasing alongside.
SK Square's business direction is proceeding in line with SK Group's growth strategy centered on semiconductors. In particular, it is continuously reviewing expansion into businesses within the semiconductor value chain that can create synergy with SK hynix.
After SK hynix issues American depositary receipts (ADR), its shareholder return policy is expected to strengthen. If SK hynix's dividend per share (DPS) expands to 13,000 won, SK Square is projected to receive 1.9 trillion won in dividend income. SK Square is expected to use this to pursue active mergers and acquisitions (M&A).
It also assessed that active shareholder returns such as share buybacks and cancellations and cash dividends are expected.
An said, "In June this year, it paid a dividend of 1,500 won per share, with total dividends of 204.3 billion won," adding, "Share buybacks of 40 billion won this year and 70 billion won in 2027 are planned."