Odaily Planet Daily report: SK Hynix's stock price has recently declined, falling 8.79% on August 3. Although it slightly rebounded by 0.64% on August 4 and 5.77% on August 5, the stock plunged another 10.37% on August 6, closing at KRW 1,495,000, and further dropped 4.88% on August 7 to close at KRW 1,422,000.
Amid increased market volatility, SK Group released an advertisement quoting founder Choi Jong-hyun: “Despair and hope are two sides of the same coin, and despair can be turned into hope as easily as flipping your hand.” The ad adapted this message to say: “The anxiety and anticipation of the AI era are also two sides of the same coin—allowing us to transform anxiety into anticipation,” conveying confidence in the long-term development of the AI industry.
Securities institutions believe that short-term stock price fluctuations have not altered SK Hynix's fundamentals; the market should focus on its technological leadership in HBM4 and the earnings stability provided by long-term supply agreements (LTAs), including:
1. Hyundai Motor Securities expects SK Hynix’s third-quarter DRAM and NAND bit growth to reach 9.7% and 1.5%, respectively. With increasing sales contributions from HBM4, DRAM average selling price (ASP) is projected to rise sequentially by 19.9%, even as the proportion of long-term supply agreements increases. Companies such as OpenAI and Anthropic are advancing the construction of their own hyperscale AI data centers and plan to raise capital through IPOs to fund these initiatives. Even if some major tech companies reduce their capital expenditures (Capex) in the future, such reductions may be offset by growing demand for AI infrastructure. Additionally, concerns regarding competition from China’s CXMT are mitigated by ongoing U.S. tightening of semiconductor equipment export controls and Micron’s expanded investments in U.S. manufacturing, making it unlikely that major companies like Apple will adopt Chinese memory chips.
2. SK Securities also views SK Hynix’s competitive advantages favorably, believing that its market position remains solid due to its leadership in HBM, strategic partnerships with major North American GPU companies, and growing demand for LTA driven by AI. Currently, HBM supply-demand satisfaction is below 70%; the core value of long-term supply agreements lies in a “mutual binding structure” between customers and suppliers, ensuring profit sustainability and operational stability. With value-reassessment initiatives such as an ADR listing and dividend proceeds from the sale of SPC assets related to Kioxia, the company may achieve its goal of 100 trillion KRW in net cash ahead of schedule. As the future shareholder return policy becomes clearer, it will help the market better recognize the value of the LTA model and further drive up SK Hynix’s valuation. (Daum)