[Click eStock] "LG Innotek Q2 Operating Profit Expected to Exceed Earnings Consensus"

[Asia Economy Reporter Oh Ju-yeon] Daishin Securities maintained its 'Buy' rating and target price of 190,000 KRW for LG Innotek on the 17th, forecasting that LG Innotek's operating profit for the second quarter will exceed market consensus.

According to Daishin Securities, LG Innotek's operating profit for the second quarter of this year is expected to be 41.1 billion KRW, surpassing the previous estimate (32.3 billion KRW) and consensus (21.1 billion KRW). Sales are estimated at 1.47 trillion KRW.

Contrary to concerns, the second-quarter performance is expected to be strong. This is because the operating rate of optical solutions is increasing due to the launch and strong sales of new models by LG Innotek's clients, semiconductor PCB (packaging) sales are favorable, and a mix effect allows for maintaining high profitability.

In the second half of the year, the company is expected to enter a repetitive peak season. Accordingly, sales and operating profit are expected to increase significantly, with third-quarter sales projected at 2.34 trillion KRW and fourth-quarter sales at 3.16 trillion KRW. Operating profits are forecasted at 160.3 billion KRW and 262.2 billion KRW, respectively.

Researcher Park Kang-ho said, "Expectations for the peak season effect in the second half remain valid, and it is positively evaluated in terms of clarity of profit growth compared to other IT companies."

Researcher Park added, "Although there is short-term pressure on stock price increases, considering the entry into a profit growth phase, the possibility that strategic clients' smartphone sales may perform better than expected, and the ongoing management efficiency improvements in low-profit sectors, further gains are also possible."

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