Son Soo-hyun

Semiconductor earnings are surging with DRAM and HBM prices rising, foreign selling is temporary, and the dip is a buying opportunity for Samsung Electronics and SK Hynix, which are must-hold long-term positions driven by robust profit growth.

Semiconductor earnings are surging with DRAM and HBM prices rising, foreign selling is temporary, and the dip is a buying opportunity for Samsung Electronics and SK Hynix, which are must-hold long-term positions driven by robust profit growth.

Samsung Electro-Mechanics is attractive due to its leadership in AI server substrates and high-cap MLCCs, where a supply bottleneck is clear until 2028. AI server substrates require larger areas, higher layer counts, and stringent thermal/power conditions, areas where Samsung excels. High-reliability MLCC demand is also tightening. Analyst price targets range from 210,000 to 300,000 won, and despite recent gains the upside remains open, making current levels a good entry point.

Semiconductor front-end equipment stocks are compelling as the industry shifts from price increases to a volume-driven capex cycle. Major chipmakers have clear expansion plans, with SK hynix aiming to double capacity in 5 years, potentially tripling within 3-4 years. Equipment companies enjoy high operating leverage as fixed costs are spread over large-scale orders, rapidly improving margins. Current sentiment is dominated by DRAM price momentum, making front-end equipment more favorable than back-end. Specific names include VM (etching), TES and Wonik IPS (deposition), and PSK (photoresist removal).

The speaker expects the KOSPI index to perform well today and remains positive long-term, supported by semiconductor strength.

Front-end semiconductor equipment stocks, especially VM, and also Wonik IPS, PSK, and Tes, are in a strong position as memory makers shift from price-led (P-cycle) to volume-driven (Q-cycle) growth, triggering massive capacity expansion (e.g., SK Hynix Yongin cluster). Equipment vendors will see order growth, improving margins through operating leverage. She prefers front-end over back-end for the near-to-medium term because DRAM is currently the focal point.

Semiconductor front-end equipment stocks are compelling as the industry shifts from price increases to a volume-driven capex cycle. Major chipmakers have clear expansion plans, with SK hynix aiming to double capacity in 5 years, potentially tripling within 3-4 years. Equipment companies enjoy high operating leverage as fixed costs are spread over large-scale orders, rapidly improving margins. Current sentiment is dominated by DRAM price momentum, making front-end equipment more favorable than back-end. Specific names include VM (etching), TES and Wonik IPS (deposition), and PSK (photoresist removal).

NVIDIA's recent pullback is a buying opportunity because the capacity reduction rumor (96GB) is not a sign of demand weakness but a supply-driven adjustment to broaden the customer base. The long-term AI demand cycle remains intact, and similar past corrections (e.g., the Turbo controversy) were followed by significant rebounds. Jensen Huang's recent comments that AI stocks are still cheap further support this view.

Hanwha Aerospace has the potential to become a Korean Lockheed Martin by integrating aerospace and defense, with US approval for K9 exports as a catalyst; the recent dip from margin disappointment is temporary and the stock remains attractive.

LIG Nex1 is undervalued relative to its order backlog; its Cheongung missile system offers cost and lead-time advantages over Patriot, and global defense spending growth supports a strong upside.