[Edaily Reporter Kwon Oh Seok ] The multilayer ceramic capacitor (MLCC) and flip-chip ball grid array (FC-BGA) markets are experiencing an unprecedented boom driven by server expansion and the emergence of high-performance semiconductor platforms. The prevailing view in the market is that these sectors have entered a phase of structural, long-term growth. Consequently, securities firms are recommending actively increasing exposure to SamsungElectroMechanics(009150)based on its improving fundamentals and earnings growth.

According to MP Doctor on the 4th, SamsungElectroMechanics closed at 1,401,000 won, up 53,000 won (3.93%) from the previous trading day. After falling for three consecutive trading days this week (August 31–September 4), the stock rebounded on the final trading day of the week.
The momentum behind SamsungElectroMechanics’ stock price rise stems from the long-term supply agreement (LTA) structure for MLCCs. Previously, on the 1st, SamsungElectroMechanics announced that it had signed a 1 trillion won supply contract for MLCCs used in artificial intelligence (AI) servers with a major global corporation.
The contract term is one year, from January 1, 2027, to December 31, 2027. This contract is the largest among SamsungElectroMechanics’ long-term MLCC supply agreements. The contract value is 1.0722 trillion won, amounting to 9.5% of SamsungElectroMechanics’ recent revenue.
SamsungElectroMechanics is accelerating its transformation toward a high-value-added component-focused business model by successively signing large-scale long-term supply agreements (LTAs) with global companies. Since last May, the company has signed long-term supply contracts totaling 3.32 trillion won for silicon capacitors and MLCCs for AI servers. Through these agreements, the company aims to secure a stable demand base and accelerate the shift toward a portfolio centered on high-value-added products.
Including this latest client, SamsungElectroMechanics has now signed LTAs with about 10 global companies. Furthermore, the company is in discussions for additional contracts with several other global firms and plans to actively respond to market demand.
Securities analysts predict that SamsungElectroMechanics’ stock price could double from current levels. Park Kang-ho, an analyst at DaishinSecurities, issued a “Buy” rating with a target price of 2.8 million won, analyzing, “We expect the mix effect—including the growing share of AI- and data center-oriented products in FC BGA and MLCC, as well as increased sales of high-value-added products—to continue expanding through 2027.”
He added, “Demand is expected to exceed forecasts as hyperscalers expand capital expenditures on AI-oriented semiconductors and data centers, and Big Tech companies increase production of their own AI chips,” noting, “Only two companies—Japan’s Ibiden and SamsungElectroMechanics for FC BGA, and Murata and SamsungElectroMechanics for MLCC—are capable of stable supply. The expansion of the high-value-added segment, which is exceeding expectations, will lead to upward revisions in earnings.”
Yang Seung-soo, an analyst at Meritz Securities, highlighted key implications of this contract. He noted, “Suppliers’ bargaining power is strengthening in terms of both volume and price. Unlike previous contracts, this one is understood to include not just a single product but multiple high-capacity MLCC product lines. This suggests that supply shortages are spreading and intensifying not only for the previously highlighted 1005 47uF (microfarad) models but also for numerous high-capacity MLCCs used in AI servers.”
Furthermore, he noted, “The increase in AI-driven demand may not only fuel growth in high-capacity products but also act as a factor that structurally reduces the supply capacity for general-purpose MLCCs. From this perspective, this contract suggests that demand for AI-oriented MLCCs is stronger than the market had anticipated, and that the resulting supply constraints are highly likely to rapidly spill over into the general-purpose market,” the firm noted, emphasizing, “It is important to reiterate that the MLCC sector is just entering a full-fledged profit improvement cycle, driven by simultaneous improvements in the mix of high-value AI-oriented products and price hikes in the general-purpose market.”
IBK Investment & Securities set a target price of 1.75 million won—a relatively modest figure—but predicted that “the full-scale growth of high-end demand will lead to supply shortages and price increases.”
Kim Un-ho, an analyst at IBK Investment & Securities, said, “Investment in AI continues to expand, and new AI hardware is focusing on improving data transfer speeds. This is driving demand for high-capacity products, and we believe SamsungElectroMechanics’ recent contract announcements reflect this.” He added, “The likelihood of accelerated MLCC price hikes is increasing. The pace of improvement in the operating profit margin is also accelerating compared to previous forecasts, and we expect it to exceed the previous peak (40%)," he said.