[Click eStock] "Interflex Applies Galaxy Z Fold3 Pen... Expecting Performance Improvement"

[Asia Economy Reporter Hyunseok Yoo] Daishin Securities analyzed on the 30th that Interflex's performance is expected to improve due to the application of a pen on the Galaxy Z Fold3 smartphone. The investment opinion 'Buy' and the target price of 17,000 KRW were maintained.

Park Kang-ho, a researcher at Daishin Securities, said, "Due to sluggish sales of Samsung Electronics' smartphones, related parts companies showed poor performance in the second quarter of 2021, and Interflex is also expected to report an operating loss in the second quarter of 2021," adding, "However, an operating profit of 3.2 billion KRW is expected in the third quarter of 2021, marking a return to profitability after eight quarters."

Researcher Park emphasized that Interflex's return to profitability in the third quarter is significant. He stated, "The estimated turnaround to operating profit in the third quarter of 2021 is due to the increased supply of digitizers (flexible PCBs) by Interflex, as the foldable phone Galaxy Z Fold3 applied the pen function for the first time," and added, "The application of the pen function, which shifted from the Galaxy Note to the Galaxy Z Fold3, is positive, and additional sales growth is expected as it expands to two models (Galaxy S22, Galaxy Z Fold4) in 2022."

He explained, "After the second half of 2021, Samsung Electronics' smartphone strategy will focus on expanding the market share of foldable phones, which are expected to replace and simultaneously meet replacement demand for the Galaxy Note segment," and continued, "Considering price reduction policies and increased production of foldable phones, demand for foldable phones is expected to increase starting in 2022." He added, "The increase in sales of the Galaxy Z Fold with pen function applied and the increased production ratio of the high-end Ultra (with pen function) model in the Galaxy S series are expected to contribute to achieving operating profit in 2022."

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