[Click eStock] "Samsung Electronics, Expected to Achieve Largest Performance in 3 Years This Year"

[Asia Economy Reporter Song Hwajeong] KB Securities maintained its 'Buy' rating and target price of 105,000 KRW for Samsung Electronics on the 12th, forecasting the company to record its highest performance in three years this year.

According to KB Securities, Samsung Electronics is expected to achieve an operating profit of 49.5 trillion KRW this year, a 38% increase compared to the previous year, marking its best performance in three years since 2018. Dongwon Kim, a researcher at KB Securities, said, "This year, semiconductor operating profit is expected to increase by 51% year-on-year to 28.4 trillion KRW, an increase of 10 trillion KRW. Especially, the semiconductor market this year will enter a supply-demand imbalance phase from the second quarter, where demand exceeds supply, due to the full-scale new investment in servers at North American data centers in the second quarter and the continued strong growth in PC and TV demand."

Currently, the global semiconductor market is experiencing strong final demand due to economic recovery and inventory accumulation demand simultaneously. Considering semiconductor companies' conservative capital investments, semiconductor demand is expected to exceed supply this year. Facing supply shortages, DRAM prices are expected to see an expanded increase from the second quarter, and the timing of NAND price rebounds is also expected to be brought forward from the third quarter to the second quarter.

Samsung Electronics' first-quarter performance this year is expected to exceed consensus. KB Securities forecasts Samsung Electronics' first-quarter operating profit to increase by 40% year-on-year to 9 trillion KRW, surpassing the consensus of 8.5 trillion KRW. Researcher Kim said, "First-quarter operating profits for smartphones (IM) and home appliances (CE) are expected to increase by 58% and 100% year-on-year to 4.1 trillion KRW and 1 trillion KRW, respectively, driving growth in the set business."

He added, "In particular, the TV, home appliance, and PC markets, which were recognized as growing due to non-face-to-face demand, are not experiencing temporary growth but are entering a structural growth phase this year along with replacement demand."

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