[Infostock Daily= Reporter An Hoe Hyun] KB Securities maintained its 'BUY' rating and target stock price of KRW105,000 on the 15th, saying that the stock price has been bottomed out due to the fact that many negative factors were reflected in SK Hynix in advance.
"SK Hynix’s stock price rise is only one-quarter of the KOSPI’s rise with a 16% increase from the low point in March and down -16% from the beginning of the year, which is sluggish compared to the KOSPI," KB Securities said, adding, "Server DRAM inventories of data center companies, which are the core of DRAM price declines, are expected to bottom out in 4Q, and SK Hynix is expected to offset sales declines and improve customer base structure due to new customers after Huawei sanctions. It have already confirmed the bottom point by entering the stock prices area, which is insensitive to negative factors and sensitive to favorable factors."
"As of September, the North American data center companies’ server DRAM inventory is 6 to 8 weeks, which is higher than normal, but SK Hynix’s DRAM inventory is expected to be 2 to 3 weeks, which is already below normal level," the company said, adding, "As we expect server DRAM inventories to reach normal levels from the first quarter of 2021, the price of server DRAM will shift upward due to increased orders from North American data center companies."
"Although additional sanctions on Huawei have been put into effect, demand for global smartphones will increase year-on-year as at least 1.3 billion units of global smartphone makers are estimated to be competing to expand their market share next year," the company said, adding, "In particular, SK Hynix will offset the decline in Huawei's sales by expanding its supply share to Apple, Oppo, Vivo, and Xiaomi through its the oligopoly DRAM supply structure and limited mobile DRAM production capacity."
Reporter An Hoe Hyun ahh@infostock.co.kr
