[Click eStock] "Samsung Electronics, Top Beneficiary of US-China Semiconductor Conflict"

Increase in Production and Restrictions on Market Disruption by China... "Positive for the Entire Semiconductor Industry"
Samsung Electronics, the Only One Able to Respond to Protectionism Worldwide
Large M&A Also Expected to Turn the Tide

Samsung Electronics Vice Chairman Lee Jae-yong is departing through the Gimpo Airport Business Aviation Center in Gangseo-gu, Seoul on the 14th.

[Asia Economy Reporter Minwoo Lee] Samsung Electronics is expected to gain a windfall from the semiconductor conflict between the United States and China. The U.S. government's halt on semiconductor investments in China is analyzed to bring positive changes to Samsung Electronics and the global semiconductor industry overall, improving semiconductor supply and demand in the mid to long term for the first time in 35 years.

On the 19th, KB Securities maintained its investment opinion of 'Buy' on Samsung Electronics and a target price of 100,000 won. The closing price the previous day was 70,200 won.

Major foreign media outlets such as Bloomberg reported that Intel's plan to increase semiconductor production in China was canceled due to security reasons. Intel recently tried to increase silicon wafer production at its Chengdu plant in China amid the semiconductor supply shortage, but the Biden administration put a stop to it. This is an example revealing the semiconductor technology conflict between the U.S. and China.

KB Securities analyzed that this atmosphere is favorable for Samsung Electronics. Just as Samsung Electronics rose to become the world's number one semiconductor company following the collapse of Japanese companies after the 1986 U.S.-Japan semiconductor agreement, the recent halt on semiconductor investments in China by the Biden administration is expected to bring a new wind to Samsung Electronics and the global semiconductor industry overall.

Dongwon Kim, a researcher at KB Securities, said, "In particular, with the semiconductor expansion plans in China (Samsung Electronics, SK Hynix, Intel, etc.) and the market entry of Chinese semiconductor companies becoming virtually impossible, mid to long-term semiconductor supply and demand improvement (2022?2024) is expected due to supply constraints." He added, "As semiconductor protectionist policies in the U.S., Europe, and Japan increase demands for domestic semiconductor factory establishments, only Samsung Electronics, which has secured capital strength, will be able to respond." He also predicted that from the customers' perspective, mid to long-term semiconductor supply constraints will lead them to secure safe memory inventory.

Large-scale mergers and acquisitions (M&A) are also anticipated. Samsung Electronics, which has already secured net cash of 100 trillion won, is expected to carry out significant large-scale M&A by 2023, the period of its shareholder return policy. Since acquiring Harman for about 9.4 trillion won in 2016, it is known that Samsung has been carefully reviewing M&A targets over the past three years. Researcher Kim said, "Considering the high cash holdings of Samsung's overseas subsidiaries, it is estimated that shareholder value will be enhanced through overseas M&A," and forecasted, "Samsung Electronics will attempt to surpass 300 trillion won in sales based on future strategic large-scale M&A."

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