[Click eStock] "Samsung SDS, Samsung Affiliate IT Services Full-Scale Launch... Expecting Performance Improvement in Second Half"

[Asia Economy Reporter Kwon Jae-hee] KB Securities maintained a 'Buy' rating on Samsung SDS on the 15th, setting a target price of 225,000 KRW.

Samsung SDS's first-quarter earnings are expected to exceed market forecasts with sales of 3.82 trillion KRW and operating profit of 241.1 billion KRW. The IT services division is anticipated to record sales of 1.4 trillion KRW and operating profit of 199.1 billion KRW, representing increases of 2% and 7.7% respectively compared to the same period last year. The logistics business division is expected to achieve sales of 2.42 trillion KRW and operating profit of 42.1 billion KRW, up 43% and 29.9% year-over-year respectively.

Researcher Kim Jun-seop of KB Securities stated, "We expect both business divisions to improve due to the increased adoption of smart factories and cloud services by Samsung affiliates, as well as strong performance driven by the logistics supply chain crisis caused by the Ukraine situation."

Samsung SDS is expected to proceed with full-scale commercialization following the completion of Samsung Electronics' next-generation enterprise resource planning (ERP) project. The ERP system built by Samsung Electronics is known to enhance work processing speed and productivity by enabling the use of various applications. The older version of SAP (Business Suite 7 Core Applications), widely used by many companies, is scheduled to end maintenance support by 2025, positioning Samsung SDS's ERP implementation for Samsung Electronics as a key reference.

Researcher Kim added, "At the end of last year, Samsung SDS reorganized its structure into a cloud business division with approximately 4,500 employees to strengthen its cloud business, and is currently enhancing its cloud-centered MSP and SaaS businesses," further analyzing, "From the second half of the year, this is expected to lead to a significant improvement in the IT services division's performance."

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