[Click eStock] "LG Display, Forecasted Reduction in Losses in the Second Half"

KB Securities Report
"Performance Depends on OLED Panel Shipment Expansion"

[Asia Economy Reporter Minji Lee] KB Securities maintained a neutral investment opinion on LG Display on the 31st and raised the target price by 15% from the previous level to 15,000 KRW.

Dongwon Kim, a researcher at KB Securities, stated, "This is due to the upward revision of earnings estimates for next year and 2022, considering yield improvements and shipment expansion of small-to-medium and large panels," adding, "Although the visibility of LG Display's earnings turnaround in the second half is low, it appears that the earnings bottom was confirmed in the second quarter due to improved profitability of large LCD panels and increased operating rates of P (Plastic)-OLED."

Third-quarter earnings are estimated at 6.6 trillion KRW in sales and an operating loss of 36.4 billion KRW, driven by profitability improvement from rising large LCD panel prices and increased P-OLED operating rates. This aligns with the market expectation of a 34.3 billion KRW loss, significantly reducing the deficit compared to the previous quarter (-517 billion KRW). Researcher Dongwon Kim explained, "The operating rate of the E6 production line is expected to rise to 85% due to increased orders for small-to-medium OLED panels from North American strategic customers," and added, "The trend of increased IT panel demand will continue due to the expansion of remote work and online education."

From the third quarter, it is expected that the OLED sales proportion in the large panel business will surpass LCD due to the expansion of WOLED (large OLED) production capacity and the reduction of LCD production lines. The production capacity of P-OLED panels is also estimated to reach 67 million units annually.

Researcher Dongwon Kim analyzed, "The key points to watch in the second half will be the successful market entry of the OLED TV aggressive sales strategy and the stable procurement of P-OLED panel volumes by strategic customers."

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