[Click eStock] "Deoksan Neolux, Long-term Earnings Improvement Phase... 'Increase Weight' Recommendation"

IM Securities has lowered the target price of Duksan Neolux to 40,000 KRW. However, it recommended 'overweight' as the stock has sufficient momentum for a price rebound, recording the second-best performance ever this year.

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Jung Won-seok, a researcher at IM Securities, stated, "Duksan Neolux has decided to acquire a 59.7% stake in Hyundai Heavy Industries Turbomachinery, a power plant and industrial pump company, for 71 billion KRW," and added, "This will be reflected in the consolidated financials starting March next year."

Hyundai Heavy Industries Turbomachinery achieved sales of 114.7 billion KRW and an operating profit of 15.2 billion KRW last year. Recently, it secured new orders related to nuclear power projects and the localization of cryogenic pumps, significantly increasing its order backlog. Researcher Jung predicted, "It will serve as a stable cash cow that can enhance the return on equity (ROE)."

He also said, "Apple will apply the Black PDL, exclusively supplied by Duksan Neolux, to the foldable iPhone model scheduled for release in the second half of next year," and forecasted, "The Black PDL, currently limited to the Galaxy Z Fold, will rapidly expand through the iPhone foldable."

He continued, "Since the Apple foldable is 2 to 3 times larger in area than the existing iPhone, assuming an annual shipment volume of 25 to 30 million panels for Apple foldables, it will have a performance effect equivalent to 60 to 80 million existing iPhones," estimating, "Operating profits will reach 64.9 billion KRW and 82.6 billion KRW in 2025 and 2026, respectively."

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