LG Innotek Co (011070 KP): Buy: 2Q26 review – earnings surprise, substrate momentum intact

研报英文原文证据摘录

LG Innotek Co (011070 KP): Buy: 2Q26 review – earnings surprise, substrate momentum intact

odule shipments and the initial benefit from variable-aperture ROE (%) 6.1 14.2 16.1 16.9

ASP gains. In Package Solutions, we expect margins to improve as new-model BT

supply ramps and memory substrates expand into DDR5. We also see FC-BGA 52-WEEK PRICE (KRW)

scaling to KRW150bn in 2026e (from KRW50bn in 2025), supported by broader PC 1800000.00

applications and initial data-centre shipments from 2H26. Overall, we forecast a strong

900000.00

2026e, with OP of KRW1.2trn (+74% y-o-y) on sales of KRW26trn (+18% y-o-y).

0.00

Correction looks overdone; substrate momentum intact: LGI’s share price has 07/25 01/26 07/26

fallen c60% from its 1 June peak (vs KOSPI -23%), reflecting concerns over how TargetHigh: 1530000.00price: 1550000.00Low: 152600.00 Current: 614000.00

much of the ABF upcycle LGI can be captured amid slower customer expansion and Source: LSEG IBES, HSBC estimates

lower utilisation vs peers. We view these concerns as excessive. With BT utilisation

above 90%, substrate pricing trending upward. and LTA discussions progressing Han Kil Chang*

(including potential customer capex participation), we believe capacity is being Research Analyst, Korea Technology

The Hongkong and Shanghai Banking Corporation

contracted ahead of the shortage we expect. As the customer mix broadens from PC Limited, Seoul Securities Branch

chipsets/CPUs today to server, automotive, and AI accelerator programmes from han.kil.chang@kr.hsbc.com

+822 3706 8750

2027e (and server CPUs from 2028e), we see FC-BGA reaching KRW400bn in 2027e

and KRW1trn in 2028e. Rising substrate profit contribution (from c20% in 2026e to

* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is