Reflecting the 2027F Al-driven shortage: Maintain Buy and raise TP to KRW2,500,000; remains as our Korea IT hardware/display sector top pick

Research evidence excerpt

Reflecting the 2027F Al-driven shortage: Maintain Buy and raise TP to KRW2,500,000; remains as our Korea IT hardware/display sector top pick

Global Markets Research

SEMCO 009150.KS 009150 KS 25 June 2026

EQUITY: TECHNOLOGY

RatingReflecting the 2027F AI-driven shortage Remains Buy

Maintain Buy and raise TP to KRW2,500,000; remains as our Korea IT Target price

Increased from KRW 2,500,000hardware/display sector top pick KRW 1,300,000

Maintain Buy and raise TP to KRW2,500,000, implying 25.2% upside Closing25 June price2026 KRW 1,997,000

We reaffirm our Buy rating and raise TP to KRW2,500,000 (from KRW1,300,000), based on

2027F EPS of KRW40,534 (previously: KRW25,233; Fig.15), multiplied by our target P/E of Implied upside +25.2%

60.7x (previously P/B of 50.4x). Our target P/E is global MLCC and substrates companies’

average 2026E consensus P/E. Market Cap (USD mn) 96,809.4

ADT (USD mn) 961.8We raise our 2027F OP by 63.1% (Fig.4) to factor in the likely shortages of MLCC and FC-

BGA driven by the strong demand from AI. SEMCO remains as our top pick in the Korea IT

Relative performance charthardware/display sector. In addition to the shortage of MLCC/FC-BGA, in our view, the valuation

is likely to benefit from spill-over fund flows from large-cap memory stock investors, despite the

rise in valuation.

MLCC may face shortage from 2027F driven by AI server demand

We believe SEMCO will likely increase its MLCC capacity by +15-20% y-y in 2026F. We expect

similar pace of capacity expansion in 2027F by utilising the Philippines factory. SEMCO will likely

face capacity shortage to meet the AI MLCC demand from 2027F, which we believe would lead

to: 1) AI MLCC price increase, 2) transition of IT MLCC line to AI line, 3) overall MLCC player