Samsung Securities announced on June 17 that it has raised its target price for OCI from 155,000 won to 160,000 won, citing stronger-than-expected profitability and ongoing improvements in basic chemical profitability due to a recovery in the semiconductor market. The firm maintained its top-pick recommendation for small and mid-cap stocks in the sector.
Research analyst Cho Hyun-ryeol stated, "We confirmed that the company's profitability is stronger than anticipated through non-deal roadshows with domestic and international institutional investors," adding, "The turnaround in the semiconductor materials business is becoming visible."
He noted that materials for semiconductors, including phosphoric acid, hydrogen peroxide, and polysilicon, have all entered a recovery cycle. He expects an increase in production volume for phosphoric acid following the completion of expansion in the third quarter, while hydrogen peroxide's operating rate, currently in the 70% range, is projected to rise to 90% in the second half of the year.
Regarding the carbon chemicals division, Cho mentioned that while profitability is linked to international oil prices, a stable trend is expected to continue even after the resolution of conflicts in the Middle East. He explained that while profitability for benzene, toluene, and xylene (BTX) products may see some decline, sales of pitch, which faced disruptions due to the conflict, are expected to expand in the latter half of the year.
Cho forecasted that the operating profit for the second quarter will reach 41 billion won, exceeding previous estimates by 25%. He anticipates significant improvements in basic chemicals due to the end of regular maintenance effects, while carbon chemicals will also maintain high profitability.
Additionally, he stated, "We have revised our annual profit forecasts for 2026 and 2027 upward, and based on this, we have further increased our target price using the sum-of-the-parts valuation method. The benefits from the semiconductor market will not only be reflected this year but will also continue into next year, making the growth impact more pronounced."
* This article has been translated by AI.
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