Citigroup raises target price for Kaixia, stating that tight NAND supply will continue until 2027 According to BlockBeats, on June 26th, Citigroup significantly raised the target price of Kaixia Holdings from 73000 yen to 140000 yen in a report released on June 25th, and maintained a "buy/high-risk" rating, citing strong demand for enterprise grade SSDs, continued tight NAND supply and demand, and the possibility of long-term supply agreements increasing profit visibility. Kaixia closed at 103850 yen on June 25th. According to Citigroup's new target price, the stock still has approximately 35% expected total return potential. The report states that NAND market prices have been rising since the fourth quarter of 2025, with "extremely strong" demand for server and data center applications, and industry wide supply shortages may continue until 2027. Citigroup's profit forecast for Kaixia is quite aggressive. The bank predicts that the company's revenue for the first quarter of FY3/27 will reach 1.82 trillion yen, an increase of 81% compared to the previous quarter; The operating profit was 1.40 trillion yen, with an operating profit margin of 77.1%. The second quarter revenue is expected to further increase to 2.43 trillion yen, with operating profit reaching 1.98 trillion yen and operating profit margin rising to 81.5%. Looking at the whole year, Citigroup expects Kaixia's FY3/27 revenue to reach 9.46 trillion yen, with an operating profit of 7.68 trillion yen and an operating profit margin of approximately 81%. The bank also expects that from FY3/27 to FY3/29, Kaixia's operating profit margin will remain above 80%. Citigroup believes that as Kaixia advances the Long Term Agreement (LTA), the cyclical volatility of the company's profits is expected to decrease. In the past, the market gave valuation discounts due to the large fluctuations in the NAND industry and high concentration of company business; If the long-term agreement expands its coverage, this discount may begin to narrow. However, Citigroup also emphasized that Kaixia is a "high-risk" stock. The risks include that if the United States relaxes its export restrictions on Chinese semiconductor equipment, it may improve China's NAND supply; If industry capital expenditures accelerate, it may lead to a renewed loosening of supply and demand; Smartphone or data center inventory adjustments may also interrupt price increases. In addition, the appreciation of the yen will erode profits. Citigroup estimates that for every 1 yen appreciation of the yen, Kaixia's operating profit will decrease by about 40 billion yen.