[Edaily Reporter kyoungeun kim ] Analysts have suggested that the recent sharp decline in the stock market, centered on semiconductors, is the result of stock prices anticipating a 2028 downturn that has not yet been confirmed. Given that real-world demand remains strong, the view is that now is the time to increase holdings by capitalizing on the market’s excessive pessimism.

Lee Su-rim, an analyst at DS Investment & Securities, stated in a report on the 19th, “The recent market plunge, centered on semiconductors, reflects a combination of concerns over interest rates, inflation, exchange rates, and a slowdown in AI investment,” adding, “While real-economy demand for semiconductors remains strong, the market is applying a higher discount rate to the sustainability of that demand.” She continued, “With earnings outlooks remaining intact, the current situation—where both valuations and supply-demand dynamics are deteriorating simultaneously—could present a buying opportunity for medium-term investors.”

The analyst cited three reasons for increasing exposure. He explained, “It is excessive to reflect concerns that profits could plummet sharply after 2028, as they have in the past, in current stock prices,” adding, “As the share of High Bandwidth Memory (HBM) grows, the profit trough during a downturn has structurally risen.” He added, “Driven by the rise in the average selling price (ASP) of HBM4E following the adoption of NVIDIA’s customized next-generation NVHBM, there is still a high likelihood that industry-wide profits will increase in 2027.”

Regarding concerns over a slowdown in AI investment, he noted that no actual decline in investment has been confirmed yet. Market research firm TrendForce raised its forecast for next year’s capital expenditure growth rate among the world’s nine major cloud service providers (CSPs) from 50% to 60% on the 14th. It also projected AI server shipment growth rates of 32.2% this year and approximately 36% next year.

The analyst identified funding instability among AI companies as the key cause of the market plunge. He explained, “Considering the recent widening of credit default swap (CDS) spreads for U.S. AI companies, the most critical cause of the plunge is weakened confidence in the funding stability of end customers—even though physical demand within the semiconductor supply chain remains strong.” “If credit risks among AI infrastructure companies subside and concerns over rising U.S. interest rates ease, the valuation of the domestic semiconductor sector could recover simply by maintaining the 2027 earnings outlook,” he predicted.

He predicted that even if a downturn occurs, the trough in earnings would be higher than in the past. According to DS Investment & Securities’ price sensitivity analysis, if the cumulative three-year average selling price (ASP) for DRAM falls by only 32% and that for NAND by 39%, earnings in 2027 are estimated to remain steady at 80–90% of their peak levels. The analyst stated, “If profits remain at 70–80% of their peak even during a downturn, the low price-to-earnings ratio (PER) will emerge as a strong investment attraction.”

DS Investment & Securities placed greater weight on a scenario in which the cumulative three-year ASP decline for DRAM remains around 30%. This is because: △ even in 2028–2030, the excess supply relative to DRAM demand will be much more limited than in the past; △ even if supply shortages are alleviated by the increasing share of HBM, the blended ASP will not fall significantly from its peak; and △ even if the ASP declines somewhat, high operating profit margins can be maintained through a mix of high-value-added products.

The analyst noted, “Unlike in the past, a structure is emerging where suppliers can protect a portion of their volume and prices from downward pressure through contracts,” adding, “HBM is more heavily influenced by customers’ product roadmaps and contract terms than by short-term spot market supply and demand, so even when prices fall, the downward pressure will be significantly lower than for standard DRAM.” He added, “As the technology evolves toward HBM4E, the value of custom base dies and interface designs will increase, further widening the premium.”

DS Investment & Securities estimated next year’s operating profits for SamsungElectronics(005930)and SK hynix(000660)at 612.1 trillion won and 406.8 trillion won, respectively. Even under the base-case scenario (DRAM ASP down 20% in 2028, 10% in 2029, and 5% in 2030), the firm analyzed that operating profit from 2028 to 2030 would decline by only 7–12% for SamsungElectronics and 12–18% for SK hynix compared to next year.