[Click eStock] "Seoul Semiconductor Rides the LED Boom"

Daishin Securities "Seoul Semiconductor, Target Price Maintained at 26,000 Won"
Focus on Expansion of Mini LED TV Market

[Asia Economy Reporter Gong Byung-sun] There is a view that the expansion of demand for light-emitting diodes (LEDs) will lead to the growth of Seoul Semiconductor. Accordingly, Daishin Securities maintained a target price of 26,000 KRW and a 'Buy' investment rating for Seoul Semiconductor.

The increase in demand for display devices is interpreted as having a positive impact on Seoul Semiconductor. Due to COVID-19, the consumer base purchasing display devices such as laptops, tablet PCs, monitors, and TVs has increased. The emergence of mini and micro LED, a new growth area, is also expected to contribute to overall growth.

As the global economy recovers, new demand is expanding. Production of automotive headlamps and LED TVs is increasing. Additionally, the oversupply trend is shrinking, and the rate of price decline is slowing, leading to higher operating rates in the LED industry, which is translating into sales. Kang-ho Park, a researcher at Daishin Securities, said, "Seoul Semiconductor's total sales this year are estimated to be 1.34 trillion KRW, a 16% increase compared to the same period last year, and operating profit is expected to rise 54.4% to 92.1 billion KRW."

Daishin Securities emphasized the need to pay attention to the expansion of the mini LED TV market. Securing market share in the premium TV segment of TV manufacturers is important, and marketing is focused on creating demand and increasing sales of mini LED TVs. Researcher Park explained, "Mini LED TVs are considered a new growth factor in the LED industry," adding, "The increase in LED demand for automotive and lighting applications will lay the foundation for reducing oversupply and raising LED prices."

Operating profit in the first quarter of this year rose 243% year-on-year to 20.5 billion KRW. This figure exceeds the market consensus of 19.5 billion KRW. Sales increased 27.6% year-on-year to 310.4 billion KRW. The growth in overseas LED TV demand and the expansion of LED sales for lighting and automotive applications appear to have contributed to the solid top-line growth.