SEMCO: Flip chip to provide new growth engine
- Company update
- TP is up to KRW41,000 from KRW40,000 / BUY maintained
SEMCO has been concentrating on FC-BGA production for Intel’s Northbridge chipset, but the company is ramping up new line for non-Intel customers.
We forecast FC sales to grow 27.5% q/q to KRW52.9bn in 3Q06. For full 2006, FC sales are estimated to increase 28.2% y/y to KRW191.7bn.
SEMCO announced that it will invest total of KRW380.5bn for capex in FC line.
If the capex is carried out as planned, capacity will reach 25mn units/month by the end of FY08 from current 10mn units/month.
We are upbeat with the fact that the company will expand its product line upon the completion of capex investment.
We revise up our TP to KRW41,000 from KRW40,000, reflecting slight changes in our earnings estimates. |
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