Kiwoom Securities on the 5th said Dreamtech's profit capacity is expected to strengthen on the back of performance in the memory module unit and normalization at subsidiaries. It kept its investment opinion at "outperform" (above market return) and raised its target price to 8,000 won from 7,000 won. Dreamtech's previous session closing price was 7,250 won.
Kiwoom Securities estimated that in the fourth quarter of this year (October–December), Dreamtech will post sales of 300.7 billion won and operating profit of 9.9 billion won. Those represent increases of 3% and 496%, respectively, from a year earlier.
Oh Hyunjin of Kiwoom Securities said, "With full-scale mass production of memory semiconductor modules at the local plant in India in the fourth quarter, cost-saving effects are expected," and added, "Subsidiary Cardiac Insight is expected to reduce losses to around the quarterly break-even level depending on performance overseas."
It also positively assessed the recent entry into the memory module business through the Indian subsidiary. After completion of the Indian plant, product approval procedures are proceeding quickly, and it said quarterly growth next year will continue through increased supply volume by product and diversification of final delivery destinations.
Oh said, "At full utilization within the India plant, annual production capacity is assessed at 200 billion won," while noting, "However, full-fledged growth will likely be possible through bio-healthcare equipment modules (BHC)."