[Click eStock] "BH, Expected Record-Breaking Performance This Year"

BNK Investment & Securities Report

[Asia Economy Reporter Minji Lee] BNK Investment & Securities on the 7th expressed expectations for record-high performance this year for BH, recommending a buy rating and setting a target price of 38,000 KRW.

BH is the largest FPCB manufacturer in Korea, with sales composition as of the first half of the year divided into display FPCB 88%, 5G antenna FPCB (4%), and smartphone protection circuit FPCB (4%). The main product, display FPCB, is supplied through the Samsung Display channel to final North American strategic customers, Samsung Electronics, and Chinese smartphone companies. The automotive wireless charging division was also acquired from LG Electronics.

Despite the smartphone market downturn, the company's sales are expected to grow 51% this year, achieving record-high performance. Minhee Lee, a researcher at BNK Investment & Securities, analyzed, “This is thanks to the combined effects of strong iPhone 13 sales, the ripple effect from competitors withdrawing from the business, and the increased market share of Samsung Display within the iPhone 14 series supply chain.” She added, “Even if sales to North American customers slow next year, an additional 210 billion KRW in sales from the new wireless charger business and continued growth in foldable phones are expected to drive an 18% sales increase.” Furthermore, from the second half of next year, when customer exposure equipment investments are completed, benefits are expected from the expansion of OLED production for IT devices.

Compared to the booming years of 2017-2018 when BH entered the North American market, the scale of performance has doubled and the operating profit margin remains at a similar level, but the market capitalization multiple relative to operating profit is discounted by 25%. Researcher Minhee Lee explained, “This reflects concerns that the economic slowdown might reduce demand for high-end phones,” adding, “Currently, the stock price decline is limited, and buying is valid from a long-term perspective.”

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