[Click eStock] LB Semicon, Expansion Effect Expected "Profitability Level-Up"

[Asia Economy Reporter Lee Seon-ae] Hana Financial Investment forecasted on the 1st that LB Semicon's consolidated sales and operating profit for 2022 will increase to 527.3 billion KRW and 65.2 billion KRW respectively, compared to the 2021 estimates of 493.5 billion KRW and 54.0 billion KRW. The sector expected to contribute significantly to sales growth by application is the System on Chip (SoC) for smartphones. However, no investment opinion or target price was provided.

Kim Kyung-min, a researcher at Hana Financial Investment, explained, "One of the factors driving performance growth in Samsung Electronics' non-memory foundry business in the downstream industry is the increased mass production of high-performance computing chips and smartphone SoCs. Although Samsung Electronics' non-memory test service partners faced difficulties in the first half of 2021 due to the Texas cold wave, it is expected that the base effect and the expansion of test equipment will be reflected in the 2022 performance."

The semiconductor test business is a growth driver for Korean OSAT (Outsourced Semiconductor Assembly Test) partners. LB Semicon announced on September 28 plans to expand non-memory semiconductor test facilities and acquire related land and buildings. Nepes Arc announced on September 10 plans to acquire semiconductor test equipment. Hana Micron finalized and announced the terms of the semiconductor test facility purchase on October 19. Tesna announced plans to acquire test equipment on August 11. This is because the volume of tests from Samsung Electronics is increasing in the downstream industry. Referring to the earnings conference call of Teradyne, a supplier of semiconductor test equipment, the increasing complexity of semiconductors drives test demand. Teradyne's test equipment sales from July to September increased by 18%, with SoC test equipment sales growing even more at 22%.

As the number of transistors within the Application Processor structure increases, the testing time also increases, requiring more test equipment. According to Teradyne's announcement, the increasing complexity of mobile semiconductors is occurring simultaneously not only in application processors but also in graphics engines, AI engines, image sensors, and power management.

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