Samsung Electro-Mechanics is strong in early trading on news of investment worth 6 trillion won in domestic and overseas substrate production bases

(Seoul = Yonhap News) Reporter Kim Yu-hyang = The early market on the 29th is showing strong performance amid news that Samsung Electro-Mechanics [009150] is investing 6 trillion won in domestic and overseas substrate production bases.

As of 9:13 am on the stock market today, Samsung Electro-Mechanics is trading at 1,528,000 won, up 1.93% from the previous day.

The stock price, which started with an increase of 1.73%, soared to 1.56 million won (+4.07%) at one point in early trading.

This can be interpreted as the impact of the news that Samsung Electro-Mechanics is investing 6 trillion won in domestic and overseas production facilities to expand its production capacity for high-value semiconductor package substrates for artificial intelligence (AI) servers.

Samsung Electro-Mechanics previously announced that it would invest 4.27 trillion won in expanding its package substrate production facilities at its Sejong plant in Korea. The Vietnam production corporation also announced that it will invest 2.51 trillion won in investment in local package substrate facilities.

Buying appears to have been stimulated by expectations that Samsung Electro-Mechanics will expand its production capacity of 'flip chip ball grid array' (FC-BGA), a semiconductor substrate for AI servers, through this large-scale investment.

Park Jun-seo, a researcher at Mirae Asset Securities, said, “This announcement is a signal that increases the visibility of substrate sales growth after 2028.”

He also emphasized, "It is understood that a significant portion of the facility investment (CAPEX) is supported by the customer," and "large-scale expansion is a section that leads to increased mid- to long-term profit visibility rather than an investment burden."

Meanwhile, Researcher Park maintained a ‘buy’ investment opinion and a target stock price of 2.8 million won for Samsung Electro-Mechanics.