[Click eStock] "LG Display, H2 Performance Improvement Becomes Visible"

[Asia Economy Reporter Oh Ju-yeon] KB Securities forecasted on the 6th that LG Display's OLED sales ratio will increase from 24% in 2018 to 52% in 2020, and that performance improvement will become visible from the second half of the year. They noted that LCD prices, which started to rebound for the first time in three years since 2016, continue to rise, acting as a positive factor for the OLED business structure transition and performance improvement. They also projected that the stock price has a 33% upside potential (19,000 KRW) based on the closing price on the 5th (14,300 KRW).

Researcher Kim Dong-won said, "The rise in LCD prices in March is expected to have a positive impact on LG Display's performance improvement as it is pursuing a business structure transition centered on OLED," adding, "This is because the LCD sales and sales ratio in 2020 are expected to be 11 trillion KRW and 48%, respectively."

He mentioned, "According to Witsview, the average LCD price in the first half of March rose by 3% compared to the second half of February due to increased inventory accumulation demand from TV manufacturers, marking the largest increase in about 40 months since November 2016."

In particular, he explained that the PC LCD price, which generates about 1 trillion KRW in annual operating profit, successfully reversed to an upward trend after 18 months since September 2018, and the 32-inch and 55-inch LCD prices, which have the greatest impact on LG Display's TV division performance, rose by 6% and 3%, respectively. Furthermore, the supply shortage of Chinese LCD module components causing production disruptions is expected to continue for the time being, leading to a tight LCD supply and demand situation this year.

Researcher Kim emphasized, "From the second half of this year, LG Display will stand out as the only display company producing both large and small OLED panels. The OLED sector will expand from a B2C (TV, PC, smartphone) focus to B2B (automotive, aviation, commercial), and the small OLED (P. OLED) division, currently recording losses, is expected to achieve full operation (production lines E6-1, 2) from the third quarter due to securing new customers such as Apple and Huawei and increased orders, making a quarterly turnaround to profitability in the second half more likely."

He added, "LG Display's performance improvement will become more visible as the second half progresses, and the OLED growth momentum will be significantly highlighted."

This content was produced with the assistance of AI translation services.