[Market Focus] Pharmicell Rises on Electronic Materials Supply Contract

As of 10:30 a.m. on October 29, Pharmicell's stock price on the KOSPI was up 12.38% from the previous day's closing price, trading at 18,430 won. This appears to be due to expectations of significant growth in sales and profits, as well as the announcement the previous day of a material supply contract worth 4.1 billion won.

Pharmicell operates a biochemical business that produces and sells electronic materials with excellent electrical properties such as low dielectric constant and low dielectric loss, pharmaceutical intermediates such as mPEG and nucleosides, eco-friendly phosphorus-based flame retardants for textiles and electronic materials, and other industrial precision chemical products. The company also runs a biomedical business that develops stem cell therapies, stores adult stem cells, and develops and sells cosmetics containing stem cell culture extracts.

On October 28, Pharmicell announced that it had signed a product supply contract worth 4.1 billion won with Doosan Electro-Materials. The contract amount is equivalent to 6.33% of Pharmicell's sales of 64.8 billion won last year.

In this regard, Meritz Securities analyzed that Pharmicell's sales of low dielectric constant (Low-k) materials are surging as it ships GB300, which is used in high-efficiency components for advanced semiconductors and data centers.

Yang Seungsoo, an analyst at Meritz Securities, explained, "Until August, sales of low dielectric constant materials to domestic clients were sluggish due to inventory adjustments that occurred during the transition to GB300. However, since September, sales of low dielectric constant materials have surged as shipments of GB300 began."

Meritz Securities estimated that Pharmicell achieved standalone sales of 26.5 billion won and operating profit of 8.3 billion won in the third quarter of this year. These figures represent increases of 81.8% and 549.6%, respectively, compared to the same period last year. The brokerage also projected that in the fourth quarter, Pharmicell would achieve sales of 35.2 billion won and operating profit of 12.5 billion won, up 64.0% and 299.1%, respectively, from a year earlier, forecasting the highest-ever quarterly performance.