[THE INVESTOR] LG Innotek’s second-quarter earnings will be better than expected, said NH Investment and Securities on July 12, maintaining a “buy” recommendation and raising the target price to 200,000 won (US$177.16) from 160,000 won.

Its revenue in the period will rise 10.3 percent on-year to 1.48 trillion won while operating profit will decline 68.8 percent to 10.2 billion won, beating market consensus. Cost cutting and strong printed circuit board materials buoyed the bottom line, said analyst Lee Gyu-ha. 

From the third quarter, its earnings will improve in earnest as its supply deal with its North American client strengthens and Vietnamese factory’s expansion furthers cost effectiveness while exchange rate turns more favorable. Despite the slowing down demand for smartphones, stronger specifications of cameras including adding triple camera features will bolster its mid- to long-term growth, said Lee.

By Hwang You-mee (glamazon@heraldcorp.com)