Sangsangin Securities raised its target price for Samsung E&A stocks to 61,000 won from 35,000 won while maintaining a BUY rating, citing growth in advanced materials and new energy sectors. Analyst Kim Jin-beom issued the report on the 27th, projecting expanded orders driven by Samsung Group's increased investments. The upgrade reflects Samsung E&A's Q2 performance, with revenue reaching 2.6 trillion won and operating profit hitting 273.1 billion won, representing year-over-year increases of 19.8% and 51% respectively.
Samsung E&A Records 273.1 Billion Won Q2 Operating Profit
Samsung E&A's second quarter results exceeded market expectations. The company recorded revenue of 2.6 trillion won and operating profit of 273.1 billion won, marking increases of 19.8% and 51% compared to the same period last year. The performance improvement was driven by the advanced materials and new energy business divisions, which demonstrated strong growth momentum during the quarter.
Advanced Materials and New Energy Segments Drive Revenue Growth
The advanced materials division recorded revenue of 838 billion won, a 45.9% increase from the previous quarter. The segment's gross profit margin (GPM) reached 17.5%, benefiting from one-time profits and foreign exchange effects. The new energy division posted revenue of 698.1 billion won, representing a 146.3% year-over-year increase, with a gross profit margin of 15.5%. In contrast, the chemical engineering division experienced revenue decline due to delays in parts of the Saudi Fadhili project caused by Middle East geopolitical risks. Kim noted that the delayed project portions could be recognized as revenue during the second half.
Samsung Group Raises Order Guidance to 7 Trillion Won
Samsung Group raised its order guidance for this year from 3 trillion won to 7 trillion won. Kim stated that while specific order volumes by affiliate have not been disclosed, the group-wide investment expansion indicates potential continuation over the next 2-3 years. Sangsangin Securities adjusted its second-half advanced industry revenue forecast for Samsung E&A to 2.2 trillion won, a 91.6% increase compared to the same period last year. Kim added that starting with the P5 project, Samsung E&A plans to directly design, procure, and construct (EPC) ultrapure water projects and leverage related technologies to target the global water treatment market.
FAQ
What target price did Sangsangin Securities set for Samsung E&A stocks?
Sangsangin Securities raised the target price to 61,000 won from the previous 35,000 won while maintaining a BUY investment rating.
What were Samsung E&A's Q2 financial results?
Samsung E&A recorded Q2 revenue of 2.6 trillion won and operating profit of 273.1 billion won, representing year-over-year increases of 19.8% and 51% respectively.
How much did Samsung Group raise its order guidance?
Samsung Group raised its order guidance for this year from 3 trillion won to 7 trillion won.
