[Click eStock] "LG Display, OLED Expected to Turn Profit in Q3"

DB Financial Investment Issues 'Buy' Rating and Target Price of 17,000 Won... Closing Price on 20th at 12,550 Won

[Asia Economy Reporter Geum Bo-ryeong] Expectations are rising that LG Display will return to profitability in the third quarter thanks to organic light-emitting diode (OLED) technology.

According to DB Financial Investment on the 21st, the price increase for liquid crystal display (LCD) TV panels in August was higher than expected (3~6%).

Kwon Seong-ryul, a researcher at DB Financial Investment, explained, "The price trend of LCD panels remains strong for both TV and IT uses, leading to a larger-than-expected reduction in losses for TV LCD panels and greater-than-expected profits for IT LCD panels, contributing to a turnaround. With this trend, there is potential for the TV LCD deficit to decrease by about 40 billion KRW in the third quarter."

Alongside this, OLED is cited as the main reason for the third-quarter turnaround. DB Financial Investment estimates LG Display's consolidated operating profit for the third quarter at 63.3 billion KRW, expecting a significant improvement from the 517 billion KRW loss in the second quarter. Researcher Kwon stated, "The large losses in the plastic OLED (POLED) business are expected to shrink significantly due to increased production rates from overseas strategic customer orders, and the large OLED segment is expected to reduce related losses by more than half as the Guangzhou plant reaches full capacity of 60,000 units by the end of the quarter. These two segments alone are expected to improve earnings by about 430 billion KRW, and recent performance supports these expectations."

DB Financial Investment has given LG Display a 'Buy' rating with a target price of 17,000 KRW. The closing price on the 20th was 12,550 KRW. Researcher Kwon said, "The return to profitability after seven quarters is not a momentum to be ignored. Although there is a possibility of losses again during the off-season, the scale will be significantly reduced, and on an annual basis, profitability is expected to resume from next year, indicating that the overall trend has already turned to improvement. Now, just before the return to profitability, is the right time to invest."

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