Yuanta Securities Korea on the 11th assessed Top Run Total Solution positively, saying the company is expanding from parts to modules and is progressing with a shift into an equipment and materials corporations through mergers and acquisitions. It did not provide an investment opinion or a target price. Top Run Total Solution's previous-day closing price was 4,230 won.
Yuanta Securities Korea analyzed that Top Run Total Solution's profitability, which slowed after listing, began to rebound in the third quarter, and that the cost-of-sales ratio also recovered to 86%, indicating it is moving out from the impact of client price cuts.
According to Top Run Total Solution's quarterly report disclosed on the electronic disclosure system, third-quarter operating profit was 5.7 billion won, rebounding from an operating loss of 660 million won in the second quarter.
Top Run Total Solution's main business is BLU (Back Light Unit). BLU refers to components used as a light source for liquid crystal displays (LCDs), which do not emit light on their own. It accounted for 37.6% of total sales last year. This year, the company signed supply contracts not only with China but also with Germany.
Kwon Myeong-jun, an analyst at Yuanta Securities Korea, said, "Top Run Total Solution plans to produce existing BLUs as module finished goods," and added, "If production succeeds, it can expect sales growth, customer diversification, and even an expansion of sales channels as a global auto parts supplier."
Regarding Top Run Total Solution's acquisitions of an organic light-emitting diode (OLED) equipment corporations and an OLED materials manufacturing corporations, Kwon said, "A shift from a parts supplier to an equipment and materials corporations is underway," and "If subsidiaries' results improve, sales growth and a valuation (corporate value) re-rating will proceed simultaneously."