By Kim Yoo-chul
A brief power supply disruption at Samsung Electronics' latest NAND flash chip-producing facilities will benefit its rival SK hynix and Samsung Electronics, market research firms said Monday.
CLSA, one of leading market research firms, said in a note that it expects the power struggle at Samsung's Xian plant to fuel additional momentum on the supply side as the price of DRAM and NAND flash chips were seeing a sign of upturn.
Samsung Electronics said early Monday that its Xian plan, which is designated to manufacture profitable three-dimensional (3D) vertical (V)-NAND chips was disrupted by a brief power outage on June 18.
Samsung Electronics later said a full normalization will take a few days with the firm stressing that the power outage will have "minimal impact" on the market.
Despite the production shortfall following the Xian fire, improved DRAM pricing and increased NAND flash chips have enabled Samsung to post another record operating margin in the second quarter of this year, higher than consensus, said local market analysts.
CLSA said the disruption will tighten supply in NAND chips ― the components to be used in all digital devices ― in the latter half. The research firm said this situation will help NAND chips see price rise, both of Samsung and SK hynix will be benefited in the mid-term.
"The one-time incident will cost Samsung up to 20 billion won, which is very minimal. It won't make heavy impact on Samsung's chip business and the entire industry," said a local fund manager by telephone. He said his team bought more Samsung Electronics stocks on the Seoul bourse after the incident.
Mirae Asset Securities said its view on Samsung won't be changed because of the disruption of the plant.
Shares of Samsung Electronics rose by 0.35 percent to end at 1,431,000 won on the Seoul bourse, while SK hynix added 3.62 percent to end at 30,050 won, according to the data from the Korea Exchange (KRX).
The chips have helped Samsung assume a dominant position in higher-margin products such as solid-state hard drives for computers and servers. The company expects less than 10,000 wafers to be affected by the disruption.