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Overview of the Headquarters of Duksan Neolux (Photo: Duksan Neolux) |
[Alpha Biz= Reporter Kim Sangjin] BNK Investment Upgrades Duksan Neolux's Target Price to KRW 40,000, Anticipates Growth from Market Recovery and Customer Diversification
On December 16, BNK Investment upgraded its target price for Duksan Neolux (213420) from KRW 36,000 to KRW 40,000, an 11.11% increase, citing expectations for market improvement and customer diversification in the coming year. The investment firm maintained its "Buy" rating.
BNK Investment explained, "The impact of global smartphone supply chain inventory adjustments has led to slower growth in Duksan Neolux’s performance and a significant drop in stock price in the second half of this year. However, the inventory adjustments of smartphone original equipment manufacturers (OEMs) are nearing completion, and many favorable catalysts are set to drive future growth."
The firm also pointed out that, “In the early part of next year, North American smartphone customers are expected to finalize their supply chains ahead of the 2026 foldable phone launch. Duksan Neolux is expected to benefit greatly from both volume and average selling price (ASP) growth." It is anticipated that next year’s North American smartphone models will feature Duksan Neolux's Green Prime material, even in the base models.
Additionally, BNK Investment highlighted the diversification of customers, noting that the materials supply to China's largest display customer, which had previously seen weak deliveries, will meaningfully increase starting in the second half of next year. Furthermore, Duksan Neolux's Black PDL material is expected to expand beyond foldable phones to include standard models, contributing to revenue growth starting next year.
Taking into account the expected market recovery and customer diversification, BNK Investment raised its 2024 revenue and operating profit forecasts for Duksan Neolux by 11% and 17%, respectively. The firm also advised noting that Duksan Neolux’s stock has historically led gains before the launch of new OLED models for smartphones and tablets from its North American clients, as they begin establishing their supply chains.
Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)
