KEC is showing strength. The stock price appears to be influenced by analyses suggesting that it will benefit from the growing power semiconductor market, which is one of the core components of electric vehicles.
As of 9:33 AM on the 28th, KEC is trading at 2,840 KRW, up 5.77% from the previous day.
The IR Council forecasted on the 28th that KEC's performance this year will show a pattern of strong first half and weaker second half. No specific investment opinion or target price was provided.
KEC is a specialized manufacturer of power semiconductors. The power semiconductor market mainly grows alongside the electric vehicle and battery industries. The core driving components of electric vehicles are the motor and inverter, as they are essential for EV operation. Power semiconductors are primarily installed in inverters. By examining the market outlook for the electric vehicle industry, one can gauge the growth potential of the power semiconductor market. According to SNE Research, the global electric vehicle (EV) battery production capacity is expected to grow from 994 GWh in 2021 to 8,247 GWh in 2030, representing an average annual growth rate of 26.5% over ten years. Global power semiconductor companies specializing in Si (Silicon) and SiC (Silicon Carbide) materials are actively expanding all sectors including raw materials, wafers, and modules, considering the high growth potential of the power semiconductor industry. This indicates the attractiveness of the power semiconductor industry. KEC is also reviewing wafer expansion related to Si and SiC, considering the industry outlook.
Researcher Baek Jong-seok of the IR Council analyzed, "Since investment in secondary battery-related industrial facilities is expected to clearly grow, this is a positive factor for the power semiconductor business." He also introduced, "KEC has a solid customer base, including Samsung Electronics, LG Electronics, and Hyundai Mobis domestically, and Panasonic, Sony, BYD, and Tesla internationally."
He added, "KEC will grow alongside its customers. If domestic companies gradually enter the SiC power semiconductor business, this will be a potential opportunity."
He analyzed, "Currently, the industry sees that SK Siltron (wafer), SK Yes Power Technics (foundry), DB HiTek (foundry), Samsung Electronics (foundry), and LX Semicon (fabless) are highly likely to enter the power semiconductor business in the future regarding SiC power semiconductors."
Researcher Baek explained, "Since the SiC business is in its early stages and domestic companies still have limited experience, new entrants are likely to focus their corporate capabilities on core value chain segments suited to each company. This means that foundry orders related to SiC could arise for KEC."
He continued, "When progressing with the SiC business, KEC plans to invest in design, front-end, and back-end processes, entering the SiC sector as an IDM and partly as a foundry. Considering its technology, experience, and track record in the Si power semiconductor business, this is quite feasible."
He stated, "In conclusion, if KEC undertakes facility investments related to SiC power semiconductors, it could welcome new customers such as automotive parts companies, automakers, and some SiC fabless companies."
Researcher Baek noted, "Entering the SiC power semiconductor business as an IDM requires at least 100 billion KRW in facility investment. KEC recognizes SiC business investment as essential given the industry's direction, but it is expected to comprehensively review yield preparation, cost minimization, and marketing strategies when actually proceeding with the business." He added, "Due to various reviews and preparations, the timing of SiC facility investment is likely to be next year rather than this year. This is expected to enable a step-up in sales compared to before."
The main applications of SiC power semiconductors are expected to be for electric vehicle internal cockpits, ADAS (Advanced Driver Assistance Systems), and inverters within electric vehicles.
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