[THE INVESTOR] SK hynix will remain strong as DRAM will be in short supply until the first half of next year, said Hyundai Motor Investment and Securities on Sept. 22, raising the target price to 105,000 won (US$92.62) from 83,000 won.

Demand for DRAM by mobile firms is expanding and the price is rising faster than expected, noted analyst No Guen-chang. SK hynix’ third-quarter revenue and operating profit will more than meet analyst estimates at 7.9 trillion won and 3.8 trillion won, respectively, according to the analyst.

From the fourth quarter, major android smartphone makers will increase their DRAM capacity aand there will be supply shortage, pushing the price up more than 10 percent, forecast No. 

As for the recent acquisition of Toshiba, the actual profits might be less than expected, said KB Investment and Securities. 

SK hynix has only 15 percent voting rights now in the new consortium that is reported to have been selected as preferred bidder, pointed out analysts Nam Dae-jong and Kim Dong-won, adding that it remains to be seen whether the deal will be finalized smoothly.

All the participants except for SK hynix are clients of Toshiba and SK hynix and have struggled from short supply of NAND. They could demand expanding manufacturing capacity, noted the analysts. As SK hynix is likely to gain less profits than initially planned, it will be more than willing to spend more in investing in NAND manufacturing facilities, they added.

By Hwang You-mee (glamazon@heraldcorp.com)