[Click eStock] "Samkang M&T, Synergy Expected with SK Group Inclusion... Target Price Up"

[Asia Economy Reporter Song Hwajeong] Eugene Investment & Securities forecasted on the 18th that Samkang M&T, having been incorporated into the SK Group, will maximize synergy, and raised the target stock price from the previous 30,000 KRW to 40,000 KRW. The investment opinion was maintained as 'Buy.'

On the previous day, SK Ecoplant announced that it invested 342.6 billion KRW in Samkang M&T, securing a 31.83% stake. Along with this, SK Ecoplant will also invest 116.9 billion KRW in convertible bonds (CB) issued by Samkang M&T. Through partial acquisition of existing shareholders' shares, a paid-in capital increase, and CB investment, SK Ecoplant will become the largest shareholder of Samkang M&T (with a final stake of 36% upon conversion of the convertible bonds).

Researcher Han Byunghwa of Eugene Investment & Securities stated, "The domestic offshore wind power complexes promoted by SK Ecoplant and SK Group affiliates exceed approximately 3GW," adding, "We expect synergy with the SK Group to be maximized." SK Ecoplant has identified offshore wind power, hydrogen, and recycling/waste businesses as its three major growth engines and is undergoing large-scale business restructuring. Accordingly, SK Group's offshore wind power business is likely to expand overseas after accumulating experience domestically, and offshore wind power projects linked to hydrogen production are expected to grow substantially both domestically and internationally. Researcher Han analyzed, "By securing a manufacturing base for substructures, which are in severe supply shortage within the offshore wind power value chain, synergy with SK Group's green hydrogen business will also increase," and added, "Samkang M&T will add a 500,000-pyeong offshore wind power substructure production base to the existing 280,000-pyeong site through an investment of about 500 billion KRW from the capital increase."

From the second half of 2024, when the expansion is completed, performance growth is expected to accelerate. Considering this, Eugene Investment & Securities revised upward Samkang M&T's earnings estimates. Sales were raised from 1 trillion KRW in 2025 to 1.4 trillion KRW in 2025 and 3 trillion KRW in 2027. Researcher Han explained, "The offshore wind power market has entered a full-scale expansion phase from Korea to Taiwan, Japan, Australia, and the US West Coast, but it is difficult to find companies capable of manufacturing substructures at Samkang M&T's level," adding, "Since expansion is directly linked to orders, despite the increase in the number of shares due to the capital increase, we have significantly raised earnings estimates with high visibility."

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