{
  "id": 19265952,
  "title": "KOSPI Trades Below 4x Forward P/E as Daishin Sees Recovery to 7,100",
  "url": "https://urgent.news/2026/11/10/kospi-trades-below-4x-forward-p-e-as-daishin-sees-recovery-to-7-100",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-11-10T02:16:51.000Z",
  "source": {
    "name": "BusinessKorea",
    "slug": "businesskorea",
    "url": "https://www.businesskorea.co.kr/news/articleView.html?idxno=280886"
  },
  "original_language": "en",
  "account": "The KOSPI stock index has fallen to trading levels described as \"extremely undervalued\" by analysts, with a forward price-to-earnings ratio (PER) below 4 for the first time since the year 2000. Daishin Securities, a brokerage firm, anticipates the index to hit a low point this month and potentially soar to around 7,100 by the first half of 2027 if fears of a slowdown in data center investment ease. Their November report revealed the KOSPI's 12-month forward PER at 3.54x and a forward price-to-book ratio (PBR) at 0.95x, indicating the index is currently priced at an 83.4% discount to estimated fair value. This undervaluation is partially attributed to worries over a potential slowdown in AI data center investment. Lee Kyung-min, a Daishin analyst, expects market conditions to stabilize through the first half of next year as these concerns dissipate. Daishin projects the KOSPI could reach approximately 5,717 if its forward PER reaches 4x, 7,146 at 5x, and 8,576 at 6x, the latter being close to the brokerage's projected range for the first quarter of next year (6,000 to 7,500). The firm assigned a 60% probability to its base-case scenario. Concerns over stricter U.S. regulations on data center construction, which have previously impacted stock markets, may be overstated, according to Daishin. The firm expects more likely outcomes to involve delays in permitting and a slowdown in investment, rather than outright bans. The firm also noted that tougher regulations could only be implemented by state legislatures, limiting governors' unilateral power. Although tightening regulations could occur in Democrat-controlled states like Texas, Georgia, and Ohio, the impact of governors' independent authority is largely confined to state-level approvals. Despite these concerns, capital expenditure (CAPEX) plans for major tech companies remain robust, with forecasts for 2027 CAPEX from the five largest big-tech firms expected to rise by 1.2% following the recent U.S. midterm elections. Daishin cautioned that delays to some data center projects might not necessarily signal weakening AI demand. The brokerage identified this as a potential tail risk with a 10% probability. Daishin recommended phased investments for KOSPI investors between 4,600 and 5,000. Looking at SK hynix specifically, DS Investment & Securities remains optimistic about the company's prospects, projecting strong profitability through 2029 even if memory prices decline. The firm maintains a Buy rating with a target price of 2.64 million won per share and forecasted SK hynix's 2027 operating profit at 443.8 trillion won, up 56% from the previous year, with an operating margin of 79%. This growth is attributed to the transition to next-generation high-bandwidth memory (HBM) products and potential adjustments to contract prices, which could offset declining average selling prices (ASP). DS Investment & Securities also forecasted SK hynix's 2027 revenue at 128.3 trillion won and operating profit at 102.1 trillion won, both up 23% from the prior year. Factors like the earlier-than-expected ramp-up at SK hynix's M15X fab in Cheongju and improved yields for 1c DRAM are expected to support higher server DRAM and HBM shipments. Long-term, demand for AI servers is projected to drive memory shipments, with global AI server shipments expected to increase by around 30% in 2028, with SK hynix's DRAM shipments growing by 23% over the next two years. Even under a scenario where DRAM and NAND flash ASPs decline by 36% and 44%, respectively, over 2028-2029, SK hynix could still generate operating profit of 330.7 trillion won in 2028 and 290.3 trillion won in 2029, taking into account depreciation expenses and potential initial production challenges. However, a more significant-than-anticipated reduction in tech investment plans or a sharp drop in semiconductor prices would present downside risks.",
  "summary": "The KOSPI has entered what analysts describe as an extreme undervaluation zone, with its forward price-to-earnings ratio (PER) falling below 4x for the first time since 2001. Daishin Securities expects the index to bottom out this month and potentially recover to around 7,100 in the first half of ne",
  "key_points": [
    "KOSPI trades at 3.54x forward P/E, lowest since 2000",
    "Daishin predicts KOSPI to reach 7,100 by 2027",
    "Analysts see 83.4% discount to fair value due to AI investment concerns"
  ],
  "editors_take": "The KOSPI's historic undervaluation offers a significant entry point for investors betting that regulatory fears regarding AI data center investments are overstated and will eventually give way to market stability.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}