[Click eStock] "Abaco, Order Momentum Expected to Accelerate"

Hana Securities analyzed on the 18th that Abaco's order momentum is expected to accelerate, and its 2024 performance is anticipated.

Kim Seong-ho, a researcher at Hana Securities, stated in a report on the same day, "Abaco, a supplier of secondary battery and display equipment, signed a contract worth 66.6 billion KRW for 'secondary battery automation system supply' on the 14th," adding, "Through this order, Abaco has proven that it maintains a steady market share within the LG Energy Solution value chain, and additional new orders are expected within the year."

Researcher Kim Seong-ho said, "Since past references are important in selecting equipment suppliers, Abaco is expected to see steady growth in new secondary battery orders and order backlog," and forecasted, "Considering the customer's expansion schedule, the additional new orders that can be secured this year, excluding this order, will be around 200 billion to 250 billion KRW."

He added, "As of the first half of this year, the order backlog for secondary battery equipment was 35.4 billion KRW, down from 111.6 billion KRW in the same period last year, but this is a temporary decrease due to revenue recognition in the second quarter," and judged, "Including recent new orders, the current secondary battery equipment order backlog exceeds 100 billion KRW, so there is no cause for concern."

He also stated, "The secondary battery roll press equipment is undergoing performance testing, and if passed, pilot shipments will proceed to the customer's domestic factory," adding, "The roll press equipment is a higher-priced product group compared to existing equipment and has a high profit margin, so if sales become full-scale, it will act as a momentum driving Abaco's performance."

Furthermore, he projected, "Abaco's 2024 sales and operating profit will be 298.9 billion KRW and 26.5 billion KRW respectively, representing increases of 43.6% and 157.3% compared to the previous year," and noted, "Although this year will inevitably see profit decline due to deferred equipment deliveries caused by reduced investment in the display front industry and development costs and hiring related to secondary battery equipment, most of this year's new orders are expected to be reflected in the 2024 performance, and if the high-margin display equipment market recovers compared to this year, performance growth will be even greater."