"KX Hightech Expected to See 290% Surge in Operating Profit This Year" [Click e-Stock]

On June 4, Hanyang Securities assessed that KX Hightech is highly likely to exceed 30 billion won in operating profit next year, citing the expansion of enterprise solid-state drive (SSD) demand in the era of artificial intelligence (AI), increased sales of SSD cases with high average selling prices (ASP), and the positive impact of capacity (CAPA) expansion.

Researcher Lee Junseok of Hanyang Securities stated in a report the same day, "KX Hightech is a semiconductor component manufacturer operating a plastics division that produces semiconductor transfer trays and a metals division focused on SSD cases. The plastics division has secured major clients such as Samsung Electronics and SK hynix and has established a stable revenue base centered on IC trays and module trays. As module trays shift to a flat tray format, the required product volume is increasing, and there is an expectation for revenue growth in the tray business division, including the possibility of entering the module tray supply chain for U.S. memory clients in the second half of the year."

He added, "The SSD case business is also rapidly shifting its core growth axis from being mainly consumer-focused to enterprise SSDs (eSSDs) with higher ASP. The proliferation of AI data centers is leading to higher SSD capacities and increased heat generation, making efficient thermal management a key task for eSSDs."

For the first quarter of this year, KX Hightech reported consolidated revenue of 35.72 billion won and operating profit of 7.49 billion won, up 35.8% and 351.0%, respectively, compared to the same period last year. The increase in eSSD case sales and the turnaround to profitability at its subsidiary Intech drove performance improvements. On a separate basis, revenue was approximately 22 billion won, with eSSD sales accounting for 11.73 billion won. Demand for eSSD cases has continued to rise since the previous quarter, with the Vietnamese eSSD plant currently operating at nearly 100% capacity.

Lee commented, "In the past, SSD cases were largely considered low value-added products, but KX Hightech has entered a phase of supply shortage and has secured all three major global memory companies as clients, proving its quality and mass production capabilities. This will elevate the company's overall profit-generating ability. For this year, we expect consolidated revenue of 142.6 billion won and operating profit of 20.74 billion won, representing year-on-year increases of 12.9% and 287.1%, respectively."

This content was produced with the assistance of AI translation services.