Next Year’s Semiconductor and Electric Vehicle Boom... Soaring Samsung SDI and Electric Stocks

Early in the session, both stocks simultaneously hit record highs... Expectations for earnings improvement amid surging demand based on electric vehicles

Samsung SDI Cheonan Plant (Provided by Samsung SDI) [Image source=Yonhap News]

[Asia Economy Reporter Minwoo Lee] With the semiconductor and electric vehicle markets expected to experience a super boom next year, Samsung SDI and Samsung Electro-Mechanics stocks are gaining strong momentum.

As of 9:02 a.m. on the 30th, Samsung SDI's stock price recorded 607,000 KRW, up 1% from the previous day, setting a new all-time high. This continued the momentum from the previous day when it surged more than 7% intraday, surpassing 600,000 KRW for the first time ever. Samsung Electro-Mechanics showed a similar trend, reaching a new high of 179,000 KRW early in the session. It also closed up 5.67% the day before. This is a differentiated performance compared to other Samsung Group stocks, which have mostly been sideways or declining after the ex-dividend date.

The surge in investor sentiment is interpreted as a result of the anticipated super boom in the semiconductor and electric vehicle markets. According to financial information provider FnGuide, Samsung SDI's consolidated market consensus for Q4 this year is sales of 3.1353 trillion KRW and operating profit of 212.6 billion KRW. This represents a 30.77% increase in sales and a 293.68% increase in operating profit compared to the same period last year. The outlook for next year’s performance is also bright, with sales expected to reach 14.205 trillion KRW and operating profit 1.1996 trillion KRW, representing increases of 22.67% and 61.35%, respectively, compared to this year's estimates.

There is particularly high expectation for the surge in demand for secondary batteries for electric vehicles. Domestic automaker Hyundai and overseas companies like GM are actively entering the electric vehicle market, and even Apple has announced plans to enter, leading to intense competition in the electric vehicle market and anticipated shortages in secondary battery supply. Kim Young-woo, a researcher at SK Securities, explained, "All automakers have presented aggressive electric vehicle expansion strategies following Tesla’s Battery Day, so the shortage of secondary battery supply could persist for a long time. Even if GM and Ford start producing batteries themselves, securing cost competitiveness compared to existing secondary battery companies is uncertain, so collaboration between automakers and secondary battery companies is expected to increase."

Samsung Electro-Mechanics is also expected to grow significantly next year. The consensus forecast for next year’s performance is sales of 2.3605 trillion KRW and operating profit of 245.7 billion KRW, representing increases of 6.11% and 49.28%, respectively, compared to this year's estimates. This is because the semiconductor market is expected to experience a 'super boom,' leading to a surge in demand for its main product, multilayer ceramic capacitors (MLCCs). MLCCs are considered the 'rice of the electronics industry' as a core material used in products containing semiconductors such as TVs, smartphones, and electric vehicles. Furthermore, all business divisions, including camera modules and semiconductor substrates, are expected to see improved performance. Park Kang-ho, a researcher at Daishin Securities, predicted, "Sales and profitability across all divisions will improve significantly, and next year will achieve the best performance in history."

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