SK Hynix Racing Forward... Targeting Market Cap of 100 Trillion Won

Record high for two consecutive days... Market cap surpasses 80 trillion
Semiconductor super boom expected next year... Market cap projected to reach 100 trillion

[Image source=Yonhap News]

[Asia Economy Reporter Minwoo Lee] SK Hynix's stock price has surged sharply, surpassing a market capitalization of 80 trillion won. The increase in non-face-to-face lifestyles due to the novel coronavirus infection (COVID-19) has led to a significant surge in demand for PC and smartphone-related components in the second half of this year, and expectations are rising as the semiconductor industry outlook for next year is also expected to be prosperous. There are forecasts that the market capitalization could break through 100 trillion won in the future.

As of 10:06 a.m. on the 3rd, SK Hynix's stock price recorded 114,500 won, up 5.05% from the previous day. It set a new all-time high again following the previous day. This is the third time in about two weeks that the stock price has surged more than 5%, following a 9.25% increase on the 16th of last month. The market capitalization reached 83.7267 trillion won.

Foreign investors, who have led the rise in the domestic stock market, continue to net buy. For four consecutive months, net purchases were recorded as 934.1 billion won in September, 24.2 billion won in October, 918.3 billion won in November, and 258.4 billion won in December (1st-2nd). This contrasts with the net sales of 2.6755 trillion won until August this year.

Amid expectations of strong performance this year, optimism is reflected that record-breaking results will be achieved next year as well. According to financial information provider FnGuide, SK Hynix's market consensus for this year's performance is sales of 31.4326 trillion won and operating profit of 4.9122 trillion won, representing increases of 16.46% and 81.08% respectively compared to the same period last year. Operating profit for next year is expected to nearly double to 8.0463 trillion won. Sales are also expected to approach 36 trillion won.

This is because an unprecedented super boom is expected next year. According to the World Semiconductor Trade Statistics (WSTS), the semiconductor industry market size next year is expected to reach 469.43 billion dollars (approximately 516.8127 trillion won), an 8.4% increase compared to this year's forecast. It is expected to surpass the all-time highest annual semiconductor sales of 468.7 billion dollars in 2018. Park Yoo-ak, a researcher at Kiwoom Securities, explained, "The DRAM industry will enter a supply shortage in the first half of next year and continue a long-term boom for two years until 2022," adding, "The NAND flash business segment is also expected to see a significant performance improvement starting from the second half of next year as demand increases, reflecting the acquisition effect of Intel's solid-state drive (SSD) business segment."

In the securities industry, target prices are being raised one after another. NH Investment & Securities, Kiwoom Securities, and others recently raised SK Hynix's target price to 140,000 won, about 22% higher than the current stock price. In this case, SK Hynix's market capitalization would increase to 101.5709 trillion won. This would mark the second company to surpass a market capitalization of 100 trillion won in about 15 years since Samsung Electronics first broke the 100 trillion won mark in January 2006. Only 32 companies have surpassed a market capitalization of 100 trillion won in the U.S. Nasdaq market.

This content was produced with the assistance of AI translation services.