Daishin Securities Co. said on the 9th that LG Innotek is expected to enter a phase of earnings growth as operating profit increases on the back of an expanded iPhone lineup in 2026 and 2027. It raised its target price to 350,000 won from 280,000 won and kept its investment opinion at "buy." LG Innotek's closing price in the previous session was 286,500 won.
Daishin Securities Co. expected LG Innotek's operating profit this year to reach 748.6 billion won, up 6% from a year earlier. In the fourth quarter, operating profit is seen at 408.4 billion won, far exceeding the securities market consensus of 340.8 billion won.
Park Kang-ho, an analyst at Daishin Securities Co., said, "We focused on the outlook for earnings expansion in 2026 and 2027, and valuation is increasingly seen as undervalued based on the current share price."
On the upward revision to operating profit, Daishin Securities Co. cited ▲ a rise in the won-dollar exchange rate on a monthly average basis against the U.S. dollar ▲ the fact that the fourth quarter is traditionally a peak season ▲ and favorable iPhone 17 sales.
Park said, "In the substrate business, the portfolio has shifted toward high added value, and from a new-growth perspective, the visualization of new businesses could serve as a catalyst for additional share price gains."
Regarding Apple's iPhone 18 to be released next year, a variable aperture is expected to be adopted, which would raise the average supply unit price of camera modules, and the number of iPhone models, including foldable phones, is also likely to increase.
Park said, "With a higher production share in Vietnam and solid competitiveness in the premium segment, this is a time to achieve both external growth and expanded profitability."
He added, "An expansion of customer transactions for flip-chip ball grid array (FC-BGA) in semiconductor substrates is also expected, making a valuation reassessment necessary."