Moody's upgrades SK Hynix

Moody's Investors Service said it upgraded the corporate family rating of SK Hynix Inc. to Ba2 from Ba3. The outlook is stable.

The agency said the upgrade reflects its expectation that SK Hynix's operating and financial profile will remain solid given the consolidation of the dynamic random access memory industry and the company's strategic focus on higher value-added products, especially growing mobile DRAM.

After the completion of Micron Technology Inc.'s (Ba3/stable) acquisition of Elpida Memory Inc. (unrated) on July 31, the top three DRAM makers - Samsung Electronics Co. Ltd. (A1/stable), SK Hynix and Micron - will dominate the DRAM market with an estimated combined market share of about 90%. The agency said that given the industry's oligopolistic structure, competitive pressures in the market will decrease, resulting in more balanced supply and demand, and the three DRAM makers will gain pricing power and better manage their capacity additions.

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