[Click eStock] "Patron, Expansion of New Business Sales... Timing for Revaluation"

Daishin Securities maintained a buy rating and a target price of 12,000 KRW on Partron on the 2nd, forecasting improved performance in the second half of this year due to increased Samsung Electronics smartphone sales and revenue from new businesses.

Partron's second-quarter sales decreased by 12.1% year-on-year to 249.7 billion KRW, and operating profit increased by 5% to 8.45 billion KRW, falling short of market estimates.

However, the analysis suggests a mid- to long-term approach is necessary. Kangho Park, a researcher at Daishin Securities, stated, "The investment point is that third-quarter sales and operating profit are estimated to increase by 16.2% and 56.6%, respectively, compared to the previous quarter," adding, "Samsung Electronics' third-quarter smartphone sales are expected to increase by 9.4% from the previous quarter and improve from the second quarter low. We anticipate an expansion in mobile phone parts sales, including a 12.7% quarter-on-quarter increase in camera module sales."

Additionally, an increase in automotive electronics sales is also expected. Automotive camera sales in the second quarter reached 21.4 billion KRW, a 37% increase from the previous quarter, exceeding expectations. This year, automotive electronics sales are projected to reach 191.2 billion KRW, a 42.6% increase year-on-year, surpassing overall growth, with the proportion of automotive electronics sales expected to rise from 11% in 2022 to 17% in 2023.

Entry into new businesses such as electronic cigarettes is also cited as a factor influencing performance improvement. Researcher Park said, "Sales from new business sectors including automotive electronics, sensors, and cigarettes are expected to reach 601.2 billion KRW in 2023, accounting for 53.6% of total sales for the first time," adding, "This is expected to reduce dependence on smartphone parts sales and marks a time to assign a new revaluation."