[This Week's Focus] JNTC Dedicated to 'Ganghwa Glass'

Growth Rate to Accelerate with Semiconductor Glass Substrates
Existing Tempered Glass Business in Stable Growth Phase
Strengthening Competitiveness through Steady Technology Development

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As artificial intelligence (AI) rapidly advances, the volume of AI data processing is increasing exponentially. AI semiconductors require large areas and highly integrated package substrates capable of covering fine circuits. The semiconductor industry anticipates that from 2030, organic material substrates will struggle to handle the expansion in transistor counts. Applying glass substrates (GCS) is expected to reduce packaging costs and enable the integration of many transistors.

Glass substrates use glass instead of organic substrate raw materials. They are harder than existing materials, allowing the formation of finer circuits, and are resistant to heat and bending. They also have advantages in terms of electrical signal loss and signal transmission speed, and their power consumption is excellent, earning them the nickname "dream substrate." When adopting glass substrates, it is understood that semiconductor fine processes can effectively be advanced by two to three generations. However, due to the nature of glass, they are vulnerable to strong external shocks or accumulated pressure, making it difficult to improve manufacturing yield. Low yield inevitably leads to higher prices. Various attempts to increase yield are ongoing, and mass production companies are expected to emerge soon.

Intel projected that by 2030, applying glass substrates would enable the integration of one trillion transistors within a single package. High-performance computing (HPC) companies such as Intel, NVIDIA, and AMD are expected to adopt glass substrates as early as 2026. They will first install them in high-end products such as AI accelerators and server central processing units (CPUs), and gradually expand the range of products using them.

Glass Substrate New Business, Full-Scale Mass Production Starting Next Year

JNTC, which produces tempered glass and connectors, is attracting attention in the domestic stock market this year. Along with expectations for glass substrate development, its stock price has nearly doubled this year. JNTC succeeded in developing semiconductor glass substrates at the end of last month.

Based on over 30 years of accumulated glass processing technology, JNTC developed semiconductor glass substrates. JNTC is a company that produces smartphone, smartwatch, and automotive display cover glass and camera windows. Tempered glass is a high-strength glass used in various fields such as displays, semiconductors, automobiles, and energy. Its high light transmittance and thin, lightweight yet strong hardness characteristics make it suitable for display covers of portable electronic devices such as smartphones, tablet PCs, and smartwatches. The cover glass that JNTC primarily manufactures is curved cover glass for smartphone front displays. 3D curved cover glass is mainly adopted in high-end flagship designs among smartphone models. A company representative said, "We possess world-class core technologies in glass processing, plating, and coating," and added, "Based on unique facilities and process technologies, our Vietnam production site has secured excellent quality, manufacturing, and cost competitiveness."

JNTC plans to establish a semiconductor glass substrate demo line at its Vietnam Plant 3 in the third quarter of this year. JNTC is in discussions with numerous domestic and international semiconductor packaging companies to supply semiconductor glass substrates. By the end of this year, it plans to establish overseas sales networks and prepare for mass production using the site of Vietnam Plant 4. Jae Namhyuk, CEO of JNTC, said, "We have reached an opportunity to grow from a specialized tempered glass company into a true global glass materials company," and added, "We will accelerate efforts to establish overseas sales networks."

Yeouido securities firms have positively evaluated JNTC's glass substrate business. Park Jongseon, a researcher at Eugene Investment & Securities, analyzed, "They possess proprietary technology related to the production process of semiconductor glass substrate prototypes," and "Through process internalization, they seem to have secured comparative advantages in quality and cost competitiveness."

Lee Gyuha, a researcher at NH Investment & Securities, said, "JNTC is currently discussing glass substrate supply with many global substrate and packaging companies," and "It is expected to start full-scale mass production from next year."

While expectations for external growth through the new glass substrate business are high, the core business is steadily generating profits. In the first quarter of this year, it recorded sales of 127.1 billion KRW and operating profit of 31.8 billion KRW. Compared to the same period last year, sales increased by 122%, and operating profit surged by 1326%. The operating profit exceeded market expectations of 27 billion KRW. The increase in smartphone shipments from customer Huawei and yield improvement effects contributed to higher profit margins. Kwon Mingyu, a researcher at SK Securities, said, "Yield was raised from below 50% at the end of last year to the mid-70% range," and predicted, "Operating profit this year will exceed 100 billion KRW." He added, "From the third quarter of this year, IT cover glass will be supplied in earnest, and mass production of two vehicle cover glass models will begin in the second half of this year."

Leading Investment & Securities estimates that JNTC will achieve consolidated sales of 541 billion KRW and operating profit of 102.2 billion KRW this year, representing increases of 67.3% and 258.1%, respectively, compared to last year. Yuseongman, a researcher at Leading Investment & Securities, explained, "We expect balanced growth in 3D cover glass, automotive glass, smartwatch, and IT cover glass."

Strengthening Competitiveness Through Continuous Technology Development

Although stable growth potential is significant, continuous price reductions by Chinese cover glass manufacturers and demand slowdown due to the global smartphone market entering maturity are considered risk factors. The intensification of global trade disputes and increased global economic uncertainty may also affect JNTC's growth.

JNTC's strategy is to strengthen competitiveness and continue growth through technology development. It continues to invest in glass processing technology development. This year, it has developed new technologies to enhance technological competitiveness one after another. Early this year, it independently developed fingerprint-resistant (AF) coating technology, which specially treats surfaces to prevent adhesion of contaminants such as fingerprints and allows easy removal even if contaminants adhere. It forms a nano-laminate structured thin film over all areas, including curved sections of displays, enhancing durability.

The AF coating technology demonstrated effects more than 20 times superior to the abrasion resistance quality standards of overseas customers. Previously, the AF coating effect lasted only a few months, but with JNTC's new technology, durability was maintained for more than 5 to 6 years. Kim Yuntaek, CEO leading JNTC's R&D, said, "We will establish our position as a leading cover glass company by developing advanced AF coating technology," and "We will improve profitability by diversifying the product portfolio and supplying high value-added products."

JNTC also developed anti-glare (AG) etching mass production technology optimized for large-area curved glass (3D). AG etching mass production technology, developed through an etching method, is known to be suitable for ultra-large curved glass used in automotive cover glass. Glass applied to cutting-edge IT device displays such as automotive displays, mobile devices, PCs, tablets, and wearables must overcome material characteristics and limitations even in harsh environments, which is a core competitiveness. To provide customized glass of various sizes and designs that meet customer quality requirements, various coating technologies are necessary. They continuously improve existing coating technologies to strengthen competitiveness. CEO Kim emphasized, "By developing AG etching mass production technology, we expect to receive additional orders from various overseas customers."