Sekonics Expected to Grow in 'Battlefield Camera' Segment

[Asia Economy Reporter Hyunseok Yoo] Sekonix is expected to improve its performance based on automotive cameras.

According to the financial investment industry on the 8th, Sekonix is an IT parts company that produces optical components for smartphones and automobiles. As of the third quarter, the cumulative sales and operating profit were 314.9 billion KRW and 10.1 billion KRW, respectively.

Shinhan Financial Investment forecasted that Sekonix's performance would remain sluggish through the fourth quarter. The expected sales for the fourth quarter are 101.5 billion KRW, and operating profit is 1 billion KRW, representing decreases of 11.8% and 75.3% compared to the same period last year. Researcher Hyungwoo Park of Shinhan Financial Investment said, "Due to semiconductor procurement difficulties, we are unable to produce all the quantities requested for supply," adding, "The semiconductor shortage situation may continue until the first half of this year."

However, it is expected that performance will improve this year compared to last year's low point. He said, "Sales of mobile camera lenses, which were sluggish, will rebound this year," explaining, "This is because strategic customers plan to increase smartphone production by about 20% compared to last year." He also added, "The structural adjustment of the domestic lens industry has been completed, which is also positive."

Along with this, the growth of automotive parts sales is expected to accelerate sharply. He explained, "Sales of automotive parts will continue structural growth with double-digit growth rates for the next several years," adding, "In particular, cameras are expected to benefit from autonomous driving, and the supply price of automotive cameras is five times higher than that of smartphone cameras."

Based on this, Shinhan Financial Investment forecasted that Sekonix's sales and operating profit this year will reach 463.2 billion KRW and 18.4 billion KRW, respectively, increasing by 11% and 65% compared to the previous year. He said, "We focus on mid- to long-term growth rather than this year; it is a turnaround company," adding, "Among IT parts companies, it has the highest proportion of automotive sales (60%) and will have the strongest benefit intensity among automotive cameras."