[E-Daily Reporter Park Jung-Soo ] On the 10th, LS SECURITIES projected that SAMSUNG SDS CO., LTD.(018260)’s medium- to long-term growth prospects would strengthen as its artificial intelligence (AI) data center (DC) business gains momentum. The firm maintained its “Buy” investment rating and raised its target price by 17.1% from 216,000 won to 253,000 won. The previous day’s closing price was 188,300 won.
Seon Yu-jin, an analyst at LS SECURITIES, stated, “We are entering a phase where the AI data center business is gradually taking shape,” adding, “Based on stable demand from affiliates and the government, the company will be able to secure both improved performance and profitability simultaneously.”
LS SECURITIES projected that SAMSUNG SDS CO., LTD.’s second-quarter consolidated revenue would reach 3.6739 trillion won, a 4.6% increase year-over-year, while operating profit would rise 1.3% to 233.3 billion won, slightly exceeding market consensus revenue estimates. The operating profit margin (OPM) was estimated at 6.3%.
In the IT services segment, the firm expects cloud revenue to rise 17% year-over-year, driving the growth rate back up to 5.2%. This is attributed to expanding corporate demand for AI transformation (AX) following the company’s designation as an OpenAI reseller partner late last year, as well as the full-year impact of GPUaaS revenue from the Dongtan data center. The logistics division is also expected to see its growth rate rebound to 4.1%, driven by increased air freight demand and freight rate hikes resulting from rising fuel surcharges.
The AI data center business was identified as a key driver of medium- to long-term growth. The company was selected as the final contractor for the government’s project to strengthen the GPU infrastructure and plans to introduce the latest GPUs; furthermore, the Haenam National AI Computing Center and the Gumi AI Data Center projects are entering full-scale implementation. The large-scale expansion of affiliated companies’ semiconductor factories is also expected to contribute to increased SI and ITO revenue.
Researcher Seon stated, “For AI projects conducted in collaboration with the government, operator margins are expected to be guaranteed through subsidies and voucher programs,” adding, “As the role of IT service companies becomes more prominent amid growing demand for AI transformation in both the public and private sectors, investor sentiment is also expected to improve.”