[Click eStock] Telechips Posts Record Q1 Earnings... "Judging Growth Trend to Continue"

[Asia Economy Reporter Ji Yeon-jin] Eugene Investment & Securities announced on the 13th that it maintains the target stock price of 23,000 KRW and a buy rating for Telechips after the company announced a surprise first-quarter performance.

The company reported preliminary first-quarter consolidated results on the 11th, recording sales of 34.9 billion KRW and operating profit of 2.5 billion KRW. Sales increased by 37.6% compared to the same period last year, and operating profit turned positive, achieving the best first-quarter performance in history.

Since the third quarter of last year, Telechips has maintained a continuous recovery in performance, driven by intelligent automobile sales, which account for 93.3% of total sales, increasing by 44.4% year-on-year. This growth is attributed to increased demand from Hyundai and Kia Motors and expanded sales to overseas clients, significantly boosting intelligent automobile-related revenue.

Sales in the second quarter of this year are expected to increase by 23.2% year-on-year, and operating profit by 218.4%. This is because production issues (foundry, testing house, PCB procurement, etc.) that occurred since the third quarter of last year have been resolved, allowing active response to client orders.

Researcher Park Jong-sun of Eugene Investment & Securities stated, "With continuous sales growth driven by increasing demand for automotive semiconductors and improving profitability, we believe the performance growth trend will continue," adding, "Currently, Telechips’ stock price is trading at a price-to-earnings ratio (PER) of 13.3 times based on this year’s expected performance, which is discounted compared to the average PER of 16.2 times for domestic and international peers."