Daishin Securities on the 7th said that as SK hynix's American depositary receipt (ADR) listing approaches on the 10th, it is an opportunity to be evaluated for corporate value on the same terms as competitors. It maintained its Buy rating and raised the target price to 3.9 million won. SK hynix's previous closing price was 2,343,000 won.
Ryu Hyeong-geun, an analyst at Daishin Securities, said of SK hynix's ADR listing, "It is an opportunity to be evaluated for corporate value on the same terms as competitors, and access for global investors will be strengthened," adding, "Given SK hynix's edge over competitors in business competitiveness and scale, the valuation discount it has received versus peers is likely to resolve quickly."
Daishin Securities raised its operating profit outlook for SK hynix to 291 trillion won this year and 432 trillion won in 2027. It expects the memory semiconductor supply-demand gap to widen further and the price increase in the second half to exceed market expectations.
In particular, it expected that in 2027 the increase in the average selling price (ASP) of DRAM led by high bandwidth memory (HBM), seen from 2023 to 2025, will recur. It assessed this as a positive development for SK hynix, which has high exposure to HBM.
In particular, the 2027 HBM ASP was projected to rise 100% from the previous year. Ryu said, "We forecast further expansion of profitability based on the industry's best cost competitiveness and strong price increases."
An analysis also noted that cash inflows from the third quarter of this year will become resources that can be used for shareholder returns.
Ryu explained, "Considering the cash inflow from the partial sale of Kioxia equity, the paid-in capital increase from the ADR issuance, and the super-boom in the industry, achieving the 10 trillion won net cash target set at the start of the year is a matter of time," adding, "Cash inflows from the third quarter will be resources available for shareholder returns."
At the same time, Ryu said they expect strengthened shareholder returns through traditional methods such as share buybacks and cancellations and special dividends.
Ryu said, "The direction of the mid- to long-term shareholder return policy will vary depending on the ADR's performance," analyzing that "if the ADR has a positive effect on enhancing corporate value, the ADR share could be expanded to as much as 10% over the long term."