[Click eStock] Wonik QnC, Samsung Electronics Delivery Delayed but...

[Asia Economy Reporter Junho Hwang] Yuanta Securities maintained the target price of Wonik QnC at 48,000 KRW on the 5th, expecting an increase in overseas quartzware sales and the performance expansion of consolidated subsidiaries.

Yuanta Securities forecasted Wonik QnC's operating profit for the first quarter to be 27.6 billion KRW, exceeding market expectations. The market expectation is around 23.8 billion KRW. For the second quarter, operating profit is expected to reach 30 billion KRW. While domestic sales are declining due to some delays in equipment delivery timings from Samsung Electronics and SK Hynix in the first half of this year, overseas quartzware sales and the performance expansion of the consolidated subsidiary Momentive are anticipated.

However, once the domestic quartzware downturn passes in the first half, a full recovery is expected from the third quarter, along with sales expansion toward TSMC due to the increase in the Taiwan factory's capacity. Accordingly, consolidated sales and operating profit for this year are expected to increase by 13% and 36% year-on-year to 708.2 billion KRW and 118.1 billion KRW, respectively.

In particular, the recent rise in quartz raw material prices, which the market has been concerned about, is expected to be a positive factor for Wonik QnC's performance.

Researcher Jaeyoon Lee of Yuanta Securities analyzed, "Wonik QnC's annual raw material purchase amount is about 170 billion KRW, of which quartz purchases account for approximately 140 billion KRW. The consolidated subsidiary Momentive, which focuses on quartz raw materials as its main business, has annual sales exceeding 250 billion KRW, so it can pass on the burden of raw material price increases to product prices."