"SEC Set to Capture Semiconductor, Defense, and Battery Markets... Benefiting from Localization of X-ray Inspection Equipment" [Click e-Stock]

On May 19, NH Investment & Securities assessed that SEC is highly likely to emerge as a key beneficiary of increasing demand for high-resolution non-destructive inspection across the semiconductor, defense, and secondary battery industries. In particular, the company projected that the adoption of in-line inspection equipment, driven by the proliferation of HBM and advanced packaging, will drive mid- to long-term performance growth.

Baek Joonki, analyst at NH Investment & Securities, stated, "SEC is an X-ray company spanning the semiconductor, defense, and battery sectors," adding, "Profitability is expected to improve as in-line inspection equipment in the semiconductor segment becomes mainstream."

SEC supplies high-resolution non-destructive inspection equipment to the semiconductor, battery, and defense industries based on its proprietary electron beam (e-beam) technology. The company has independently secured electron gun and electron beam control technologies and is recognized as the world's only company to have developed and internalized a 'hybrid open tube' that realizes both the long lifespan of closed tubes and the ultra-high resolution of open tubes.

NH Investment & Securities particularly focused on the growth potential of the semiconductor inspection equipment business. The firm analyzed that demand for 3D X-ray inspection equipment for yield management is rapidly rising as HBM integration, 2.5D/3D packaging technology advancement, and the introduction of hybrid bonding (HCB) expand.

Analyst Baek explained, "In HBM stacked structures and advanced packaging processes, it is becoming increasingly difficult to detect micro-defects with conventional inspection methods," adding, "The adoption of 3D X-ray based in-line inspection equipment is likely to become mainstream."

SEC already completed the preliminary development of HBM stacked inspection equipment through a national project in 2022 and is currently conducting sample tests for domestic IDM companies. The company is also expected to expand its supply of equipment for wafer-level packaging (WLP) and panel-level packaging (PLP) processes in the future.

Analyst Baek predicted, "Going forward, equipment for WLP and PLP processes will drive customer diversification, especially among global OSAT companies, and serve as a factor for increased unit prices."

The defense business was also cited as a major growth engine. SEC is benefiting from the localization of the non-destructive inspection market based on linear accelerator (LINAC) technology and is expanding its inspection lineup from small and medium-sized to large weapon systems. The company is expected to benefit from rising domestic replacement demand in sectors that were previously highly dependent on foreign equipment.

In the battery segment, orders that had been delayed due to the electric vehicle chasm are projected to resume starting this year. NH Investment & Securities also forecast that battery inspection demand will recover and service division performance will improve accordingly.

In particular, the securities firm positively evaluated the fact that the overhang issue, which had been considered a market burden, has been largely resolved.

Analyst Baek diagnosed, "With the entire overhang volume digested, the defense and battery service divisions are now securing momentum through the resumption of deferred orders and entry into new markets."

NH Investment & Securities forecast that SEC will enter a full-fledged performance turnaround phase beginning next year. The company estimated consolidated operating profit to reach 900 million won in 2026, turning profitable, and projected sales of 109.9 billion won and operating profit of 9.4 billion won in 2027. The operating margin is expected to be around 8.5%.

Analyst Baek emphasized, "In 2027, all business divisions are expected to improve their performance, entering a profit leverage phase. The expansion of inspection demand across the semiconductor, defense, and battery industries will serve as a long-term growth driver."

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