[Click eStock] LG Display, LCD Dip Not Significant

[Asia Economy Reporter Junho Hwang] On the 28th, IBK Investment & Securities raised the target price of LG Display from 22,000 KRW to 30,000 KRW.

IBK Investment & Securities expects LG Display's Q4 sales to increase by 15.2% compared to Q3, reaching 8.318 trillion KRW. The shipment area is projected to increase by 12.5% compared to Q3 to approximately 9,402 ㎢, and the ASP is expected to rise by 2.7% compared to Q3 2021 to 770 USD/㎡.

Operating profit is forecasted to increase by 13.4% compared to Q3 to 601 billion KRW. While LCD TV is expected to perform significantly worse than in Q3, IT panels are expected to slightly decrease, and OLED is anticipated to improve significantly compared to Q3. P OLED’s ASP is expected to rise compared to last year due to new product effects, but profitability is not expected to improve, whereas W OLED’s operating profit margin is expected to improve compared to Q3 due to increased volume.

Although concerns about performance deterioration due to weak LCD TV panel prices and demand will act as variables for a considerable period, the proportion of LCD TV is continuously decreasing, so the negative impact is not expected to be significant. Relatively, LCD IT panels maintain stable profitability, and until last year, the profitability of OLED TV and P OLED, which recorded operating losses, is greatly improving, which is considered a positive factor.

Kim Unho, a researcher at IBK Investment & Securities, said, "We maintain a buy rating on LG Display," adding, "Despite the decline in LCD prices, operating profit in Q4 is expected to increase compared to Q3, and even considering the decrease in operating profit due to the decline in LCD panel prices, operating profit in 2022 is expected to exceed 1.4 trillion KRW, so the current stock price is judged to be undervalued."

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