SK Telecom to Invest 1.5 Trillion Won in AI, Raising Questions Over Whether It Can Preserve Its 'AAA' Top-Tier Credit Rating [fn Market Watch]

[Financial News] As SK Telecom pours nearly 1.5 trillion won into its AI data center and semiconductor business, concerns are growing over whether the move will increase its financial burden. Credit rating agencies said the impact on its credit profile is likely to be limited, given its strong cash-generating ability and phased investment structure.
According to the investment banking industry on the 28th, NICE Investors Service said in a recent market comment that even with long-term funding needs totaling 1.4884 trillion won, including a 750 billion won investment in SK Hyper, the dedicated AI data center subsidiary, and the previously announced 738.4 billion won investment in SK hynix's NAND business, SK Telecom's financial stability is unlikely to be significantly undermined.
NICE Investors Service said the main reason the impact on creditworthiness would be limited is the staged investment structure. SK Telecom plans to invest 330 billion won first in SK Hyper, while the remaining 420 billion won will be injected gradually through a capital call arrangement in line with business progress through 2030.
Song Young-jin, a senior researcher at NICE Investors Service, said, "Because the funds will not be disbursed all at once, the short-term financial burden should not be large." He added, "Its strong cash-generating ability and financial flexibility are also more than sufficient."
In fact, SK Telecom posted consolidated EBITDA of 1.4162 trillion won and an EBITDA-to-telecom revenue ratio of 34.5% in the first quarter of this year, recovering profitability to levels seen before last year's data breach incident. As of the end of March, it held 1.7728 trillion won in cash and cash equivalents, and NICE Investors Service said it also has ample financial room to draw on long-term investment assets and owned real estate.
In particular, considering that only five domestic private non-financial companies, including SK Telecom, KT Corporation, KT&G Corporation, Hyundai Motor Company, and Kia Corporation, maintain the top corporate bond rating of 'AAA,' the assessment appears to reflect the agency's view that the company will preserve its top-tier financial stability despite large-scale AI investment.
Song said, "We expect funding needs to continue as the company builds AI data centers and invests in new growth businesses." He added, "However, with the easing of 5G investment burdens and stable operating cash flow, it should be able to finance a substantial portion on its own." He also forecast that "it will maintain strong financial stability over the medium to long term, taking into account capital accumulation from earnings generation."
Still, NICE Investors Service identified future annual investment amounts, additional spending tied to the expansion of the AI business, and changes in financial stability as key monitoring factors.
[email protected] Kim Hyun-jung Reporter