Research Update: SK Hynix Inc. Outlook Revised To Positive On Improving Operating Performance, Financial Metrics; 'BBB-' Rating Affirmed

SK Hynix's (Hynix) operating performance is likely to be strong for next one to two years, owing to a favorable memory chip market, driven by robust semiconductor demand globally amid COVID-19. We expect the Korea-based memory semiconductor manufacturer to maintain robust financial metrics despite the acquisition of Intel's NAND business, with adjusted debt-to-EBITDA ratio at 0.4x-0.9x in 2021-2022. We revised the outlook on Hynix to positive from stable, and affirmed our 'BBB-' long-term issuer credit rating on the company. At the same time, we raised Hynix's stand-alone credit profile (SACP) to 'bbb-' from 'bb+'. The positive outlook reflects our view that the market for memory chips will be favorable for next one to two years. This should underpin Hynix's good

...- SK Hynix's (Hynix) operating performance is likely to be strong for next one to two years, owing to a favorable memory chip market, driven by robust semiconductor demand globally amid COVID-19. - We expect the Korea-based memory semiconductor manufacturer to maintain robust financial metrics despite the acquisition of Intel's NAND business, with adjusted debt-to-EBITDA ratio at 0.4x-0.9x in 2021-2022. - We revised the outlook on Hynix to positive from stable, and affirmed our '###-' long-term issuer credit rating on the company. At the same time, we raised Hynix's stand-alone credit profile (SACP) to '###-' from '##+'. - The positive outlook reflects our view that the market for memory chips will be favorable for next one to two years. This should underpin Hynix's good operating performance and positive free cash flows, with a debt-to-EBITDA ratio below 1.0x despite the pending acquisition....

Research Update