[Edaily Reporter Shin Ha-yeon ] On the 5th, NH INVESTMENT & SECURITIES projected that MKElectron(033160)would emerge as a leading beneficiary of the surge in demand for bonding wire driven by the widespread adoption of SoCAMM2 memory for artificial intelligence (AI) servers. The firm assessed that the stock offers attractive valuation, noting that its price-to-earnings ratio (PER) stands at just 5 times based solely on its semiconductor division’s earnings. However, it did not provide an investment rating or target price.

Mok Jin-won, an analyst at NH INVESTMENT & SECURITIES, analyzed, “The essence of the benefits from SoCAMM2 lies in the fact that LPDDR (low-power memory), which was previously limited to mobile devices, is emerging as the core memory for ultra-high-performance AI servers, leading to a significant increase in demand for bonding wires,” adding, “The wire bonding market, which had been dismissed as a declining industry due to competition from advanced packaging, is making a comeback.”

He continued, “The adoption of SoCAMM2 modules is gaining momentum due to changes in data center architecture centered around NVIDIA’s Vera CPU racks,” explaining, “The spread of this trend marks a historic turning point in which the wire bonding process—which utilizes bonding wires—is being reevaluated as a core process for achieving high integration and high efficiency in the AI server memory ecosystem.”

In particular, he predicted that SoCAMM2’s high-stacking structure would significantly increase the use of bonding wires. Researcher Mok said, “As memory manufacturers consider plans to utilize 2GB dies with proven yield and mass-production capabilities, a 12-layer high-stacking structure is required to achieve the same capacity,” adding, “If the number of die stacking layers increases from 8 to 12, demand for bonding wires will surge by more than 50% per individual package.”

The solder ball business was also cited as a new growth driver. Researcher Mok projected, “As full-scale shipments to South Korea’s largest memory client—where the company serves as a secondary supplier—are expected to materialize as early as the fourth quarter of this year, we anticipate rapidly narrowing the shipment gap with competitors,” adding, “Achieving the annual sales target of 40 to 45 billion won is highly likely.” He added, “We have also secured long-term growth momentum by pursuing entry into the micro solder ball market.”

He also predicted that the new palladium (Pd) alloy business would contribute to improved profitability. Analyst Mok stated, “By replacing the supply chain that previously relied entirely on Japanese companies, we are rapidly meeting the localization needs of domestic pogopin manufacturers,” and added, “We expect the Pd Alloy business to contribute high margins in 2026, with sales of 15 billion won and operating profit of 5.3 billion won (OPM of 35%).”

He also projected that earnings improvement would gain momentum. Analyst Mok analyzed, “On a consolidated basis, 2026 revenue is estimated to reach 2.0328 trillion won, a 44.8% year-over-year increase, while operating profit is projected to rise 774.4% to 124 billion won,” adding, “The semiconductor division alone is expected to generate revenue of 1.795 trillion won and operating profit of 88 billion won (+185%).”

He also highlighted the company’s attractive valuation. “While companies such as SIMMTECH Co., Ltd., TLB Co., Ltd., and DaeduckElectronics—which share the narrative of adopting SoC-on-Chip 2 and memory modules—are trading at high multiples of 20–25 times P/E based on their 2026 projected earnings, this company is trading at a P/E ratio of just 5.0 times,” he noted. “Given that the company is also in the process of improving its profit margins through new businesses such as Pd Alloy, its relative undervaluation is expected to become even more apparent,” he assessed.