(Adds more quotes, analyst comments, updates share prices)
By Rhee So-eui and Marie-France Han
SEOUL, March 28 (Reuters) - South Korea's Samsung Electronics (005930.KS), the world's biggest maker of memory chips and TVs, cut its target for 2008 sales and issued a modest forecast for earnings growth in what it called a difficult global environment.
The lower target for 10 percent sales growth, which undershot most brokerage forecasts, underscores the Asian technology giant's cautious stance in the face of a slowing world economy and an ongoing investigation into the parent group's alleged slush fund, analysts said.
Analysts said strong demand for mobile phones and liquid crystal displays (LCD) is likely to help it exceed its target. Samsung shares rose, outperforming the market.
"Samsung can easily post 20 percent growth in total revenue given that it should achieve very strong gains from LCD and handsets," said Song Myung-sup, an analyst at CJ Investment & Securities.
"The 10 percent growth forecast marks the absolute minimum level the company aims to achieve."
Shares in Samsung, the country's largest company with $91 billion in market value, rose 1.49 percent to 614,000 won at 0244 GMT, in line with a rising technology sector on expectations that mobile phones and LCD sales will boost first quarter earnings. The KOSPI index .KS11 rose 1 percent.
"We are aiming to post a sales increase of more than 10 percent than in 2007," Samsung Electronics Chief Executive Yun Jong-yong said at the company's annual shareholder meeting on Friday. The new target is lower than a January company forecast for 15 percent growth.
"We will focus on high value businesses and aim to post a net profit higher than 2007's," Yun also said, adding that the 2008 targets have not been finalised.
In 2007 Samsung posted net profit of 7.43 trillion won ($7.53 billion) on sales of 63.18 trillion won on a parent basis. Sales grew 7 percent in 2007.
Analysts surveyed by Reuters Estimates forecast Samsung to earn 9.04 trillion won in net profit this year on 72.24 trillion won in sales -- a 22 percent and 14 percent growth respectively.
Samsung's memory chip business, once a cash cow, is grappling with extremely difficult market conditions because of oversupply and collapsing prices in dynamic random access memory (DRAM) used in personal computers.
The sector's profitability has been compounded by steep price falls in NAND flash chips, used in portable electronics.
But Samsung's liquid crystal display (LCD) business is set to enjoy a strong year with solid demand for flat-screen TVs and tight supplies.
Its mobile phone business, the world's second-biggest, is expected to grow on strong demand from emerging markets and outshine rivals Motorola MOT.N and Sony Ericsson (ERICb.ST) (6758.T).
The recent weakness in the won KRW= currency, which helps exporters like Samsung price their goods competitively overseas, adds to the optimism about Samsung's business.
"If the won remains weak, Samsung is likely to show much better results than today's sales forecast", said Kim Hyun-joong, an analyst at Tong Yang Investment Bank.
"Global economic growth is expected to slow this year," Yun said, citing high oil and raw materials prices and global financial markets rendered unstable by the dollar's weakness.
"We aim to continue posting high profits from our four strategic businesses -- memory chips, LCD, mobile phones and TV -- by being the first ones to enter next-generation markets and differentiating our products."
Yun remained cautious about the handset market. "The mobile phone industry could see a radical change in the competition landscape due to Motorola's restructuring."
He added Samsung is also working to become a leader in the growing markets for next-generation storage devices and mobile internet.
Outside its business, Samsung Electronics faces a tougher situation. It has said key executive decisions regarding the company had been delayed pending an investigation into the parent Samsung Group's [SAGR.UL] alleged slush funds.
South Korea in January launched a special probe after a former legal executive said Samsung kept a slush fund in accounts set up in its executives' names to pay off officials and squash probes into its management practices.
Samsung has denied any wrongdoing and called the accusations groundless. ($1=987.2 WON) (Additional reporting by Park Ju-min, editing by Louise Heavens)