[Click eStock] "PI Advanced Materials, H2 Earnings Recovery... Target Price Up"

Meritz Securities raised the target price for PI Advanced Materials by 10%, from 40,000 KRW to 44,000 KRW, on the 17th.

PI Advanced Materials is expected to record a loss of approximately 8.8 billion KRW in the first quarter of this year. This is due to the suspension of factory operations in January and February to adjust inventory. As a result, the inventory levels of PI Advanced Materials and its customers have sharply declined. From the second quarter, with the launch of new products, monthly sales are expected to continuously increase. In particular, starting in June, the supply of PI films for heat dissipation sheets to North American customers will begin, and due to deferred and replacement demand, a steep performance recovery is anticipated in the second half of the year, driven by the high shipment volume of the iPhone 15.

Additionally, sales to non-smartphone sectors are expected to expand significantly. Benefits are anticipated from the increased use of cylindrical batteries and the passage of the Inflation Reduction Act (IRA). Especially, the proportion of sales to the automotive electronics sector is expected to rapidly increase from 14.7% last year to 27.4% in 2024.

Yang Seung-su, a researcher at Meritz Securities, stated, "Gradual expansion of benefits is possible due to market growth," and explained the reason for the target price increase, saying, "This reflects expectations for demand improvement and application expansion."