[Market Focus] Schem Surges 9.81% on Expectations of OLED Recycling Sales Growth

The stock price of Schem, which is expected to see rapid earnings growth alongside its OLED (organic light-emitting diode) material recycling business, is showing strong performance.

As of 9:18 a.m. on the 27th, Schem was trading at 6,380 won, up 570 won (9.81%) from the previous trading day.

Hana Securities evaluated Schem on this day, stating, "Rapid earnings growth is expected as the OLED material recycling business expands." Choi Jaeho, a researcher at Hana Securities, said, "Schem's OLED recycling (RC) sales surged from 900 million won in 2022 to 7.5 billion won last year," and projected, "This year, sales will expand to 10.2 billion won, and next year to 25 billion won."

OLED material recycling is a business in which Schem collects and refines OLED organic materials, about 80% of which are discarded during the display manufacturing process, and then supplies them again to client companies. The recycled materials are priced at about 10% of the cost of new materials, providing significant cost-saving benefits for clients.

Researcher Choi explained, "Global display manufacturers are continuously expanding their OLED material recycling items to improve panel yield and secure price competitiveness," adding, "Schem's investment of approximately 4 billion won in June to expand dedicated OLED material recycling line capacity was also in response to this growing demand."

He further added, "With the expansion and full-scale supply of OLED recycled material items, next year's sales are expected to reach 50.3 billion won (an 84.9% increase from this year), and operating profit is projected at 9.6 billion won (a 432.2% increase)," emphasizing that "there is sufficient potential for valuation re-rating based on rapid earnings growth."