SK Telecom's shares have surged over 6% during trading, driven by expectations of expanding its artificial intelligence (AI) data center business, earnings recovery, and dividend prospects.
According to the Korea Exchange, as of 10:48 a.m. on July 16, SK Telecom's stock was trading at 90,200 won, up 5,200 won (6.12%) from the previous trading day.
The rise in stock price is attributed to the government's push for the AI data center (AI DC) project, one of the three major mega-projects under the 'Korea Great Leap Forward' initiative, which has encouraged investor sentiment as SK Telecom accelerates its related business expansion.
On the previous day, SK Telecom established the 'AI DC Integrated Promotion Team' under its CEO, appointing Jeong Seok-geun, head of the AI CIC, as the team leader. The team will oversee the entire process of the AI data center project, from site selection and design to construction and customer acquisition.
SK Telecom is leading the SK Group's AI data center initiatives, starting with a facility in Ulsan and planning to expand to the Yeongnam and Honam regions.
Analysts are also focusing on the AI data center business and its potential for earnings improvement. Meritz Securities upgraded its investment rating for SK Telecom from 'Hold' to 'Buy' and raised its target price from 98,000 won to 110,000 won.
Jeong Ji-soo, an analyst at Meritz Securities, stated, "The consolidated operating profit for the second quarter is expected to be 535.5 billion won, in line with market consensus. Improvements in wireless performance due to an increase in 5G subscribers and growth in SK Broadband's data center-focused corporate business will drive earnings."
He added, "With the completion of the Ulsan data center and the Seoul 3 data center in 2027, along with the full-scale launch of the colocation business, the data center segment is expected to make a significant contribution to earnings. Considering the normalization of earnings and the appeal of dividends, we have upgraded our investment rating to 'Buy' and increased the target price to 110,000 won."
* This article has been translated by AI.
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