Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

High Yield Experts

Senior Credit Analyst, Lucror Analytics

Trung Nguyen

Senior Credit Analyst

Credit

We view SK Hynix as “Low Risk” on the LARA scale. We view positively the company’s large scale and solid positioning, with SK Hynix being the No. 2 player in the oligopolistic memory-chip industry. However, the industry is very cyclical, with a long lead time to increase capacity. It is currently experiencing an unprecedented downturn, following two years of strong pandemic-driven demand due to work- and learn-from-home arrangements. This has resulted in dismal revenue, earnings and cash flows for SK Hynix. The company is concurrently weighed down by the debt-funded acquisition of Solidigm, for which a USD 2 bn second-closing payment is due. We see a significant risk of the credit being a fallen angel. Our Credit Bias on SK Hynix is “Negative”, due to the memory-chip industry downturn. Moreover, we see rising downgrade pressure. SK Hynix operates in an industry that is generally free of ESG concerns. Controversies for the company are negligible, the only one being an allegedly opaque salary structure which resulted in some employee dissatisfaction. SK Group, which controls SK Hynix, has also been questioned for possible linkage to the corruption scandal involving former South Korean president Park Geun-hye and Samsung. However, we do not view this as material. In this context, Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral".

  We view SK Hynix as “Low Risk” on the LARA scale. We view positively the company’s large scale and solid positioning, with SK Hynix being the No. 2 player in the oligopolistic memory-chip industry. However, the industry is very cyclical, with a long lead time to increase capacity. It is currently experiencing an unprecedented downturn, following two years of strong pandemic-driven demand due to work- and learn-from-home arrangements. This has resulted in dismal revenue, earnings and cash flows for SK Hynix. The company is concurrently weighed down by the debt-funded acquisition of Solidigm, for which a USD 2 bn second-closing payment is due. We see a significant risk of the credit being a fallen angel.   Our Credit Bias on SK Hynix is “Negative”, due to the memory-chip industry downturn. Moreover, we see rising downgrade pressure.   SK Hynix operates in an industry that is generally free of ESG concerns. Controversies for the company are negligible, the only one being an allegedly opaque salary structure which resulted in some employee dissatisfaction. SK Group, which controls SK Hynix, has also been questioned for possible linkage to the corruption scandal involving former South Korean president Park Geun-hye and Samsung. However, we do not view this as material. In this context, Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral". 

SK Hynix

SK Hynix - Tear Sheet - Lucror Analytics