SK Hynix Weighs a Cheongju Packaging Bet Against a Halved Morgan Stanley Target

SK Hynix finds itself pulled in two directions at once. On one side sits a reported plan to widen its high-bandwidth-memory back end at Cheongju; on the other, a sharply reduced price target and a selloff that dragged the stock down 3.0% on Friday.

Start with the expansion. Reports carried by the Electronic Times describe at least 20,000 additional HBM wafers per month of capacity, with tooling for the P&T6 site scheduled to go in during the first half of 2027. The equipment in question handles bonding, dicing and testing. SK Hynix has not confirmed the capacity figures.

That distinction matters more than the headline number. P&T6 packages and tests chips; it does not produce DRAM wafers. The reported build-out therefore touches downstream steps and should not be read as an equivalent lift in wafer fabrication. Electronic Times put SK Hynix's total HBM capacity at roughly 150,000 wafers a month at the end of 2025, a figure in the same ballpark as one floated back in February. What Tuesday's reporting adds is a proposed installation window and a list of required tools — not a capacity plan making its debut.

Demand Beyond Nvidia

The customer mix is the more interesting thread. According to the reports, orders from AMD and Broadcom would underpin demand even if the Nvidia business were to soften, making the project a wager on a broader client base for AI memory. That rationale carries more weight for valuation than the raw capacity figure, since extra packaging and testing lines only pay off if orders follow. The reports tie the project explicitly to demand outside Nvidia — though nothing in them establishes independence from how that business develops.

SK Hynix offered a separate signal on orders on October 28, saying it had wrapped up volume and price negotiations for 2027 HBM shipments. It disclosed neither specific prices nor volumes. Analyst Chris Caso expects memory demand to outstrip supply at least through 2028 and sees further HBM price increases in 2027. That view supports the economics of added tooling, but it remains a forecast — it substitutes neither for company confirmation of the expansion nor for cost details. Until confirmed investment and capacity figures arrive, a plausible demand case sits opposite an unconfirmed scope.

Target Cut and a Leadership Shock

The stock pressure came from elsewhere. Morgan Stanley had already slashed its SK Hynix price target in a November 9 note, cutting it from 2.6 million Won to 1.6 million Won. The broker cited concerns about a growing chip supply and delays in data-center construction, turning its lens on both the supply side of the chip market and the infrastructure build-out behind demand. That call predated Friday's turmoil.

Reuters attributed Friday's decline to investor reaction to the resignation of Nvidia chief Jensen Huang, which weighed on other AI-linked names as well and stirred worries about the wider AI capital-spending story and Nvidia's supply chain.

On the corporate front, parent SK Group said on November 9 that SK Hynix plans additional leadership appointments and a reorganization of its US operations around December 3, part of preparations to grow its American headcount. A separate announcement on Wednesday concerned memory for physical-AI applications: SK Hynix said it had obtained IEC 61508 certification for memory used in those applications.