[Click eStock] "Iljin Electric, High-Voltage Transformer Orders Increase... Target Price Set at 35,000"
Published 17 Oct.2024 08:45(KST)
Yuanta Securities on the 17th set the target price for Iljin Electric at 35,000 KRW, which is 56% higher than the current stock price. It is expected that sales and profits will rapidly increase as orders worth around 2 trillion KRW accumulate, centered on ultra-high voltage transformers.
Son Hyun-jung, an analyst at Yuanta Securities, stated, "Iljin Electric is currently expanding its production capacity (CAPA) in the ultra-high voltage transformer and wire sectors," adding, "The new factory will begin full-scale operation starting this December." Accordingly, he forecasted, "An additional production capacity of about 400 billion KRW will be secured by next year," and "Sales growth will accelerate from next year."
He also estimated that this year's sales will increase by 17.1% year-on-year to 1.4605 trillion KRW, and operating profit will rise by 28.4% to 78 billion KRW. Analyst Son predicted, "The 430 billion KRW worth of ultra-high voltage transformer contracts for the U.S. secured last year are expected to be recognized as sales after the second half of next year." Reflecting this, he expected next year's sales and operating profit to increase by 15.3% and 61.4%, respectively, to 1.6839 trillion KRW and 125.9 billion KRW.
He explained, "Iljin Electric currently holds an order backlog worth 2.2 trillion KRW," noting, "60% of this is accounted for by ultra-high voltage transformers." In particular, he pointed out, "The overseas transformer order backlog has increased about fourfold in one year," and predicted, "As production volume significantly increases next year, an operating leverage effect will emerge."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.