Will a Big Tech Contract Be Enough to Spark a Boom? Is the Data Center Era Opening? | Lee Jun-ho, Senior Researcher, Hana Securities Research Center
Big Tech Contract, One Page Is Enough to Explode...Is the Data Center Era Opening? | Lee Jun-ho, Hana Securities Research Center Senior Researcher [Double Up]
Speakers
Lee Jun
— Senior Researcher, Hana Securities Research Center
Summary
Lee Jun-ho, senior researcher at Hana Securities, presents a detailed thesis on Korea's data center mega projects, highlighting a massive gap between government targets and market pricing. He argues that the market hasn't reflected the 12GW of planned capacity, and the key catalyst will be actual lease contracts from global hyperscalers in Q3. He identifies Naver and Samsung SDS as the only full-stack providers capable of capturing this opportunity, with Naver favored if a contract materializes. He also names KINX, GS Construction, and SCC Energy as additional beneficiaries.
- Government data center targets: 8.4GW by 2029, 18.4GW by 2035, far above earlier forecasts due to AI inference demand.
- Combined corporate plans reach ~12GW vs. current ~1.5GW installed base, but the market remains skeptical because no big-tech lease contracts have been signed.
- Naver (1GW plan) and Samsung SDS (300MW plan) are the only domestic firms with full-stack data center experience; both stocks have not priced in any expansion benefits.
- The crucial trigger is a Q3 contract announcement: if a global hyperscaler signs a long-term lease with a Korean firm, it will validate the investment case and gradually boost share prices.
- Utilities and construction play: SK Eternix, SCC Energy, GS Construction, GNC Energy, and KINX are also cited as direct or indirect beneficiaries.
- Investment strategy: watch for contract confirmation in H2 2024 before entering Naver and Samsung SDS; KINX already has visible orders and revenue.
- A surprise rate hike during the show was noted but is pre- priced; attention should stay on the data center theme.
Ideas
Naver poised for data center contract catalyst
Naver is one of only two Korean companies with full-stack data center service capability, has the largest planned capacity (1GW), and is pursuing a global hyperscaler lease for 200MW. The market has not priced this in, and if a contract is announced in Q3, the stock could rally as revenue could begin as early as next year.
Samsung SDS benefits from data center buildout
Samsung SDS is the other full-stack data center provider with 300MW planned capacity, will benefit from stable captive Samsung group demand and the domestic data center buildout, serving as a defensive play even if global contracts fail to appear.
SCC Energy benefits from data center growth
SCC Energy is expected to benefit from the expansion of data centers, with its own data center project in Gunsan providing a similar revenue catalyst.
