SK Materials 'Soars'... Market Cap Surpasses 3 Trillion Won

[Asia Economy Reporter Koh Hyung-kwang] SK Materials has broken its all-time high and surpassed a market capitalization of 3 trillion won. Despite the COVID-19 pandemic, the company continued to post strong earnings, and expectations for new businesses next year are believed to have been reflected in the stock price.

According to the Korea Exchange on the 16th, SK Materials closed at 292,500 won on the KOSDAQ market the previous day, up 2.09% from the previous trading day. It set a new all-time high again following October 14. The market capitalization also surpassed 3 trillion won for the first time. Based on the previous day's closing price, the market cap was 3.0851 trillion won, ranking 10th in the KOSDAQ.

Compared to the stock price two months ago on October 16 (218,400 won), it rose 33.9%. It has nearly tripled compared to the yearly low of 108,100 won recorded in March. Over the past month, foreign and institutional investors have aggressively purchased SK Materials shares, pushing up the stock price. From the 16th of last month to the previous day, foreigners net bought 20.6 billion won, and institutions net bought 12 billion won.

SK Materials is a company that manufactures semiconductor and display materials. It produces specialty gases and precursors used in panel manufacturing, as well as industrial gases, and has facilities with proprietary technology capable of mass-producing high-purity materials. Since being acquired by SK in February 2016, the company has expanded its business areas through mergers and acquisitions (M&A) and has now established itself as a core materials company within the SK Group. SK Airgas, SK Trichem, SK Showa Denko, and Hanyou Chemical are subsidiaries of SK Materials. Major customers include domestic and international semiconductor and display companies such as Samsung Electronics, SK Hynix, LG Display, Micron, Sharp, and TSMC.

The upward trend in SK Materials' stock price is analyzed to be due to steady strong earnings despite the impact of COVID-19 and reflected expectations for business expansion next year. On a consolidated basis, SK Materials posted an operating profit of 62.5 billion won in the third quarter of this year, an 11.4% increase compared to the same period last year. This is the first time quarterly operating profit has exceeded 60 billion won. Sales during the same period were 246.7 billion won, up 22.1% from the previous year. So Hyun-chul, a researcher at Shinhan Financial Investment Securities, said, "This year's total sales are expected to increase by 22.1% year-on-year to 942.8 billion won, driven by a surge in sales of high value-added precursors for semiconductors, and operating profit is expected to increase by 11.4% to 239.3 billion won." He added, "Next year, sales of semiconductor materials and specialty gases will increase, and sales from new businesses such as hydrogen fluoride will begin in earnest, resulting in sales of 1.0641 trillion won and operating profit of 287.9 billion won."

Expectations for next year's business are also high. SK Materials is diversifying its product portfolio from specialty gases such as nitrogen trifluoride (NF3) to organic light-emitting diode (OLED) and eco-friendly materials. Recently, it also established a joint venture (JV) with the Japanese OLED materials company JNC. Do Hyun-woo, a researcher at NH Investment & Securities, said, "The combination of JNC's technology and SK Materials' financial strength is expected to create synergy effects in the future," adding, "Improvement in memory supply and demand early next year will also help increase performance."

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