[Click eStock] "LG Electronics, Q1 Home Appliance Record Earnings Expected... Target Price Up"

On the 24th, KB Securities raised the target price for LG Electronics from 110,000 won to 120,000 won, anticipating that the home appliance business will achieve record-high performance this year. The investment rating was maintained at 'Buy.'

Dongwon Kim, a researcher at KB Securities, explained, "The target price was raised by 9% compared to the previous estimate because the home appliance (H&A) business is expected to record its highest-ever performance this year, with sales increasing by 5% year-on-year to 35 trillion won and operating profit rising by 10% to 2.3 trillion won, leading to an upward revision of earnings estimates." He added, "In particular, LG Electronics' home appliance business has secured double-digit margins, with HVAC (heating, ventilation, and air conditioning) sales accounting for one-third of total home appliance sales. Logistics costs, which have already peaked, are likely to decrease further in the second half of the year. The concerns over U.S. tariffs on LG Electronics, which has diversified its global production plants, are expected to be offset."

KB Securities estimated LG Electronics' first-quarter performance this year at 22.3 trillion won in sales, up 6% year-on-year, and 1.17 trillion won in operating profit, down 12%. Researcher Kim said, "This exceeds the previous operating profit estimate by 12%. In particular, the first-quarter home appliance performance is expected to approach 10 trillion won in sales and exceed 1 trillion won in operating profit, marking the highest quarterly performance."

There is a forecast that the System-on-Chip (SoC) center, a leader in semiconductor design, will lead new businesses. Although LG Group sold its affiliate LG Semiconductor in 1999, LG Electronics continues to operate the SoC center with 600 research and development (R&D) personnel, enhancing semiconductor chip design technology. Researcher Kim stated, "LG Electronics' SoC center is independently procuring high-performance semiconductors using advanced foundry processes from TSMC and others in AI, robotics, automotive electronics, and home appliances, while also promoting external supply. Additionally, LG Electronics is jointly developing chiplet technology, which is key to semiconductor performance and scalability, with ARM, Synopsys, Bosch, BMW, and is reportedly exploring potential collaboration opportunities related to quantum computer chips with Microsoft (MS) and IBM. From a long-term perspective, the SoC center is expected to lead new businesses."

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