SIMMTECH Bets Big on 274.2 Billion Won Expansion... "Confident in SOCAMM Demand in 2028"

[Financial News] As SIMMTECH Co., Ltd. moves ahead with a new facility investment worth 274.2 billion won, the brokerage industry said the decision reflects confidence in demand for SOCAMM in 2028. Analysts said the move, which favors building a dedicated plant over expanding existing facilities, improves visibility for medium- to long-term demand.
On the 26th, iM Securities maintained its investment rating of "Buy" and its target price of 185,000 won for SIMMTECH Co., Ltd.
SIMMTECH Co., Ltd. disclosed the previous day that it would invest a total of 274.2 billion won in new facilities. The amount equals 47.6% of its equity capital at the end of last year. It will invest 145.9 billion won in a new plant dedicated to SOCAMM modules, 105.1 billion won to expand MSAP production capacity, and 23.2 billion won in system IC. Mass production is scheduled for the first quarter of 2028.
iM Securities highlighted the faster-than-expected decision to expand capacity. SIMMTECH Co., Ltd. had previously said it could meet demand through 2027 with existing production capacity and was considering expansion to prepare for 2028 demand. The brokerage said the expansion decision itself signals confirmed visibility for medium- to long-term demand, and that the investment was finalized earlier than expected.
With this investment, monthly production capacity for SOCAMM modules will rise from 4,600 square meters to 7,000 square meters, while annual sales production capacity will increase from 300 billion won to 500 billion won. The company had also considered a plan to add equipment to its existing non-memory line and raise capacity to around 400 billion won, but it ultimately chose to build a dedicated plant near its headquarters.
Ko Eui-young, a researcher at iM Securities, said, "Choosing a larger investment instead of a low-cost compromise is evidence of confidence in the scale and durability of demand," adding, "This expansion appears to be driven by demand from memory semiconductor customers overall."
He added, "We plan to make further upward revisions as we confirm the actual strength of customer demand and the pace of new capacity expansion." However, he noted, "Because the funding will combine internal reserves and external financing, short-term stock price volatility may emerge depending on the financing method."

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