"Something Big Is Coming Soon"... Stock Transforms from Telecom Operator into AI Utility Provider [Click e-Stock]

Eugene Investment & Securities raised its target price for SK Telecom from 94,000 won to 135,700 won. It also upgraded its rating from Neutral to Buy.

On October 27, researcher Lee Chanyeong of Eugene Investment & Securities said, "This reflects applying a target price-to-earnings ratio (PER) of 20 times to next year's forecast earnings per share (EPS) of 6,785 won."

SK Telecom is expanding its artificial intelligence (AI) data center business. Lee said, "The company is combining global AI customer demand and capital with SK Hyper's development capabilities to expand colocation, graphics processing unit (GPU) cloud, and power infrastructure. If regulations are opened up, it could procure and sell power to data centers and, over the long term, expand the businesses it supplies to include factories and large buildings, becoming an AI utility."

SK Hyper, a subsidiary established by SK Telecom last July to specialize in AI data center business development, is also drawing attention for its capabilities. Lee said, "With Korea Electric Power Corporation's (KEPCO) burden of investing in the power grid and delays in grid connections, the need for private-sector participation in infrastructure development is growing. SK Hyper is a key player in turning expanding opportunities for private-sector participation into actual projects by coordinating power supply discussions with power generators, KEPCO's connection reviews, and the construction of incoming power lines and substations with data center development schedules."

Lee noted, "SK Telecom's market capitalization is about 17 trillion won, and expectations for its data center business have yet to be fully reflected in its valuation. The recent movement in its share price has been driven more by trading flows related to Anthropic. Volatility is expected to increase if Anthropic goes public, but once long-term contracts with data center customers are confirmed, investor focus is expected to shift to AI infrastructure stocks and drive the share price higher."

Lee added, "Ultimately, announcements of long-term customer contracts and the opening of power regulations will support the narrative of expanding the utility business through SK Hyper. This will lead to a valuation rerating, with the company being recognized not just as a telecom operator but also for its potential as an AI utility provider."

This content was produced with the assistance of AI translation services.