[Click e-Stock] "TFE Sees Strong Socket Sales... Poised for Record-Breaking Performance Since Founding"

On August 22, Hana Securities stated regarding TFE, "With the expansion of large-area socket supply for data centers and the acquisition of new clients, the company is expected to achieve its highest performance since its founding this year," while maintaining a 'Buy' investment rating and setting a target price of 45,000 won.

Kim Minkyoung, a researcher at Hana Securities, explained, "TFE is currently working on multiple projects, including those related to new clients and CPO (Co-Packaged Optics) products. By securing references in silicon photonics, the company has laid the groundwork for expanding large-area socket sales for data centers in the future."

This year, TFE's estimated annual revenue is expected to reach 105.2 billion won, a 43% increase year-on-year, while operating profit is projected to surge by 195% to 18.5 billion won, resulting in an operating margin of 18%. In the first half of the year, the company recorded 47.1 billion won in sales and 6.9 billion won in operating profit, driven by the recovery in memory socket demand and increased supply of mobile AP sockets due to strong smartphone sales from major clients.

The growth trend is expected to continue in the second half of the year. Researcher Kim analyzed, "Second-half sales are projected to reach 58.1 billion won, with operating profit at around 11.6 billion won. Demand for memory sockets such as DDR5, GDDR, and LPDDR remains solid, and as supply to new clients ramps up, rapid growth is expected to continue." She added, "Given the increase in PCB purchases, which are the main board raw materials, in the first half, the high-margin R&D socket volume is expected to be reflected mainly in the second half."

Securing a foundation for mid- to long-term growth was also cited as an investment point. In December last year, TFE announced new facility investments aimed at expanding product manufacturing capacity in line with business expansion. As a result, socket production capacity is expected to more than double. Researcher Kim noted, "With the acquisition of multiple new clients and an expanded presence among major clients, R&D demand for new products such as CPO, ASIC, SOCAMM, LPCAMM, and HBF is increasing, so the utilization rate is expected to rise rapidly after the expansion."

She further predicted, "With the establishment of overseas branches in Singapore and the United States, the company is expected to respond proactively to international clients, leading to a rapid expansion of its presence among overseas customers."