Samsung Electro-Mechanics is emerging as a key value chain player in the expansion of AI demand within the multilayer ceramic capacitor (MLCC) and substrate sectors, solidifying its status as a leading global component manufacturer, according to recent analysis.

(From top left clockwise) Silicon capacity, semiconductor package substrate stacked structure, weatherproof automotive camera module, MLCC, semiconductor package substrate. Samsung Electro-Mechanics website.

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According to Shinhan Investment Corp. on May 27, researcher Oh Gangho noted that “structural growth is being driven by the expansion of high value-added product sales and improvements in supply prices, which differ from previous cycles,” naming Samsung Electro-Mechanics as the top pick in the sector.

He also maintained a ‘Buy’ investment rating and raised the target share price from 1 million won to 2 million won. On the previous trading day, Samsung Electro-Mechanics closed at 1,572,000 won, up 232,000 won (17.31%) from the previous day. As of 10:24 a.m. on May 27, the share price stands at 1,664,000 won.

The core driver of growth is high value-added AI-related products. On May 20, Samsung Electro-Mechanics announced a silicon capacitor supply contract worth 1.6 trillion won. Oh pointed out, “As instantaneous current usage of AI GPUs (graphics processing units) and application-specific integrated circuits (ASICs) increases, technology that stably maintains high-speed computation and power efficiency is becoming more important. The significance of silicon capacitors that stabilize power close to the chip is growing.”

In particular, this contract is expected not to replace existing MLCCs, but rather to increase new high value-added demand related to AI. Considering the contract size, next year’s component sales are projected to be revised upward by 11% compared to previous estimates. Given the product characteristics, production is expected to be carried out separately from current capacity.

Accordingly, performance forecasts and valuation reassessments are underway simultaneously. Profitability improvements in components and substrates, product mix optimization resulting from component utilization rates exceeding 90%, and additional revenue expansion through portfolio diversification are also anticipated.

Samsung Electro-Mechanics Suwon Plant. Samsung Electro-Mechanics.

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Researcher Oh stated, “The price-to-earnings ratio (PER) of Murata, a global component company, rose from 18 times in 2024 to 48 times in 2026, and the average PER of substrate companies such as Ibiden and Unimicron reached 64 times over the past two years. Samsung Electro-Mechanics, having entered a structural growth phase, is entering a period of corporate value reassessment alongside global industry leaders.”