Global investment bank JPMorgan has identified Hanmi Semiconductor as the company poised to benefit most from the expansion of the artificial intelligence (AI) industry and the growing demand for high-bandwidth memory (HBM).
Hanmi Semiconductor, a South Korean company, is known for its expertise in producing equipment used in the manufacturing of semiconductor components, particularly for the assembly and packaging of memory chips.
JPMorgan issued an “Overweight” rating on Hanmi Semiconductor and set a target price of 150,000 won ($104.21), 52.4% higher than the stock’s previous closing price of approximately $68.36.
According to financial industry sources, JPMorgan acknowledged that competition in the TC Bonder (TCB) equipment market, which is used in HBM production, remains a challenge. The TCB market has faced concerns about the potential entry of new competitors, causing Hanmi Semiconductor’s stock price to plummet from a peak of about $136.29 in June last year.
However, JPMorgan predicts steady demand for HBM TCBs as Hanmi Semiconductor secures customers such as SK hynix and U.S. Micron Technology.
The bank also noted that the company’s technological edge, including its upcoming upgrade to fluxless TCB equipment, should help it maintain a dominant market share of around 90%. Fluxless technology refers to a method that eliminates the need for flux, an adhesive used between chip dies, in the manufacturing process.
JPMorgan forecasts Hanmi Semiconductor’s sales and operating profit for this year to reach $570.3 million and $277.8 million, respectively, marking increases of 46.9% and 56.9% compared to the previous year.
Despite concerns that a slowdown in the HBM market and intensified competition could pose risks to Hanmi Semiconductor, JPMorgan emphasized the company’s strong profitability and market share. The firm concluded that Hanmi Semiconductor holds long-term investment appeal.
