[Click eStock] "LG Innotek Warms Up with Record Quarterly Performance... Expected to Continue in Q1 This Year"

[Asia Economy Reporter Oh Ju-yeon] Daishin Securities forecasted on the 13th that LG Innotek's performance in the fourth quarter of last year will set a quarterly record high, and that this record-breaking trend will continue into the first quarter of this year.

According to Daishin Securities, LG Innotek's consolidated operating profit for Q4 2020 is expected to be 314.7 billion KRW, with sales reaching 3.5791 trillion KRW. This is attributed to strong sales of premium smartphones, the iPhone 12 Pro and iPhone 12 Pro Max, from global strategic clients, leading to record performance in optical solutions (camera modules). The effect of smartphone launches being delayed by 1 to 2 months compared to previous years, concentrating sales in Q4, was also reflected.

Daishin Securities expects this Q4 effect to continue into the first quarter of this year.

LG Innotek's operating profit for Q1 2021 is projected to be 206.8 billion KRW, marking the highest performance for a first quarter. Analyst Park Kang-ho of Daishin Securities stated, "Efforts to improve management efficiency will eliminate LED deficit factors, increase semiconductor PCB sales, and maximize mix effects."

Operating profit for this year is expected to increase by 33.9% year-on-year to 783.1 billion KRW. Optical solutions will continuously drive growth, with additional adoption of ToF cameras boosting sales, and the pursuit of higher resolution and enhanced functions in main cameras stabilizing the average selling price.

Furthermore, as the number of 5G-enabled models among strategic clients' smartphones expands, benefits are expected in semiconductor PCB (AiP). This is an area where active facility investment and proactive response can lead to increased market share within client companies. The turnaround to operating profit in automotive components is also expected to contribute to valuation upgrades.

Daishin Securities maintained its investment opinion of "Buy" on LG Innotek and raised the target stock price from 200,000 KRW to 230,000 KRW.

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