DB HiTek’s 8-Inch Foundry Valuation Soars—Will It Raise Prices for a Third Time This Year?

[Financial News] KB Securities raised its target price for DB HiTek by 18% to 200,000 won. The brokerage expects DB HiTek to fully benefit from successive price increases as the supply-demand imbalance in the 8-inch (200mm) foundry market worsens amid explosive growth in China’s artificial intelligence (AI) data center and robotics markets. The stock’s upside from its current price is estimated at 98.4%.
On the 8th, KB Securities estimated that DB HiTek’s revenue in the third quarter of 2026 would rise 10% year on year to 411.2 billion won, while operating profit would increase 50% to 120.8 billion won. Its operating margin is projected at 29.4%. These results would exceed market consensus. Although the decline in the won-dollar exchange rate is a negative factor, KB Securities said it would be offset by several developments: the effect of the first 5% foundry price increase decided in March began to be reflected in results from June; the benefits of full-capacity operations are being fully realized; and 10% second-round price increases will be partially applied starting with September results. For the full year, revenue is expected to reach 1.6 trillion won, up 15% from the previous year, while operating profit is projected at 424.2 billion won, up 53%. The annual operating margin is forecast at 26.5%.
The structural backdrop is the simultaneous contraction of supply and surge in demand. Supply capacity in the 8-inch foundry market, once classified as mature, is declining as leading manufacturers such as Taiwan Semiconductor Manufacturing Company Limited (TSMC) and Samsung Electronics shift their focus to 12-inch (300mm) production. Meanwhile, demand for power management ICs (PMICs) and analog chips used in Chinese AI data centers and robots is expanding rapidly. Taiwanese manufacturers’ use of 8-inch lines to handle silicon photonics-related production is also cited as a factor exacerbating the supply-demand distortion.
As competitors repeatedly raise prices by 10% to 20%, DB HiTek is also highly likely to implement a third price increase this year, analysts said. KB Securities expects this trend to continue through 2027, with two additional price increases likely to be implemented.
DB HiTek’s valuation appeal is also coming into focus. Its 12-month forward P/E ratio stands at just 9.4 times. Analysts say this represents excessive undervaluation compared with the company’s earnings improvement trajectory. KB Securities expects the stock to rise sharply as the market’s perception of its undervaluation is gradually dispelled.

[email protected] Kang Gu-gwi Reporter