[Click eStock] "Samsung Electro-Mechanics Enters Early Recovery Cycle... Attractive Stock Price Level"

On the 27th, NH Investment & Securities maintained its 'Buy' rating and target price of 190,000 KRW for Samsung Electro-Mechanics.

NH Investment & Securities expects Samsung Electro-Mechanics to continue growing this year, supported by strong demand from China. Overall, the large-scale subsidy policies by Chinese e-commerce companies have been implemented since March, leading to a noticeable price reduction. Smartphone sales are expanding due to reopening, and PC sales are increasing influenced by the official adoption of E-sports at the Hangzhou Asian Games.

In the second half of the year, IT demand recovery is expected to strengthen further. This is due to the upcoming launch of the iPhone 15 series, which involves a large-scale hardware upgrade, as well as intensified promotions by IT set manufacturers aiming to capture pent-up demand and the peak season effect.

The steep growth trend is also positive in the automotive MLCC market, driven by product and customer diversification. Samsung Electro-Mechanics, which has expanded its market share from around the global 5th place in the past to 3rd place recently, following Murata and TDK, has started supplying high value-added powertrain MLCCs to North American electric vehicle manufacturers. High growth is expected to continue going forward.

Lee Gyu-ha, a researcher at NH Investment & Securities, analyzed, “After conducting large-scale inventory adjustments due to concerns over demand slowdown caused by macroeconomic weakness, the MLCC cycle has entered a recovery phase faster than expected, driven by steady IT device demand and expanding demand across various industries such as automotive and AI. A full-scale business improvement is expected to be confirmed from the second quarter, and MLCC supply and demand is projected to tighten from the second half of the year. As demand improves and MLCC margins recover, Samsung Electro-Mechanics’ stock price is expected to level up once again.”

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