[Click eStock] "Intec Plus, Expecting Expansion in Inspection Equipment Orders... Target Price Up 20%"

Korea Investment & Securities Report

[Asia Economy Reporter Minji Lee] Korea Investment & Securities on the 20th upgraded its investment opinion to Buy and raised the target price for Intecplus by 20% to 21,000 KRW, reflecting solid order intake in the first quarter.

Intecplus's sales and operating profit this year are estimated to grow by 32% and 63% year-on-year, reaching 58 billion KRW and 10 billion KRW, respectively. This is due to the expected significant increase in demand for inspection equipment driven by expanded capital investment from foundry clients and the rise of chiplet-structured semiconductors.

Currently, Intecplus is divided into semiconductor packaging division serving semiconductor companies and OSAT (Outsourced Semiconductor Assembly and Test) companies, semiconductor mid-end (substrate) division serving semiconductor substrate companies, display division, and secondary battery division.

Intecplus is the exclusive supplier of visual inspection equipment to its major client, Company I, and is likely to see expanded orders this year. Company I is known to be very conservative in selecting and changing final packaging visual inspection equipment suppliers. This policy aims to unify the final visual inspection equipment supplier to maintain consistent quality. Researcher Yerim Lim of Korea Investment & Securities explained, “Considering Company I’s policy, outsourcing from foundry company T is likely,” adding, “The visibility of future orders has increased.”

Company T’s recent conference call last week, stating that the chiplet structure will become a market trend, is also positive for Intecplus. Intecplus possesses semiconductor inspection technology for chiplet-structured semiconductors.

Growth in the substrate division, which serves semiconductor substrate companies as clients, is also expected to be remarkable. The expected sales of these divisions this year are projected to increase by about 42% compared to last year, establishing them as the company’s main growth drivers. While last year was a year when global semiconductor substrate companies secured new clients, this year is expected to see increased equipment demand due to clients’ facility expansions.

Researcher Yerim Lim said, “This year, the supply and demand for HPC semiconductor substrates will continue, and expansions by substrate companies are expected,” adding, “AMD has recently recognized shortages in central processing units (CPU) and graphics processing units (GPU) supply and has stated it will pay attention to the semiconductor substrate supply situation, which is also a factor to consider.” She further added, “With Intel’s 10nm server CPU entering mass production from the first quarter, the shortage of semiconductor substrate supply is expected to continue for the time being.”