Leading electronic components companies in the country, Samsung Electro-mechanics and LG Innotek are having a fierce competition for the top spot.
Last year, the sales gap between the two companies had been greatly narrowed due to the slump of Samsung Electro-mechanics and the chase of LG Innotek as Samsung Electronics smartphones had fallen. Nevertheless, as Samsung Electronics is widening the gap again, thanks to the effect of Galaxy S6.
Samsung Electro-mechanics and LG Innotek are showing a steep growth in performances. Operating profit improvement is accelerating. The operating profits of the two companies for the first quarter are presumed to be over 10~20% higher than the observation values that market investigation enterprises have presented.
LG Innotek is in rapid growth as they have been providing the 8.0 megapixel Optical Image Stabilization(OIS) camera module for Apple’s iPhone 6·iPhone 6 Plus since last year. Last year’s sales difference between the two companies was the smallest ever since the market for smartphones had ever opened. In the operating profit field, LG Innotek overtook Samsung Electro-mechanics.
Samsung Electro-magnetics is outplaying LG Innotek by providing key components for Galaxy S6·Galaxy S6 Edge such as HDI mainboard·16.0 megapixel camera module·Flip Chip(FC)·Chip Scale Package(CSP)
As Samsung Electronics has started early production of Galaxy S6·Galaxy S6 Edge, Samsung Electro-mechanics’ results of the first quarter is estimated to reach 55.2 million dollars, which is a value over 20% higher than the original market estimates. It is expected that they will outrun LG Innotek again, with their operating profit of the second quarter reaching over 92 million dollars.
The competitive composition for the top stop depends on the success or failure of their future growth engine business. Samsung Electro-mechanics is trying hard for the time being to reinforce mobile component competitiveness and to reduce dependence on Samsung Electronics by expanding exports to China.
Samsung Electro-mechanics is gradually reaping the fruitful results from entering the Chinese smartphone market as they have recently secured Xiaomi as their new client.
LG Innotek are concentrating on reducing their dependence on mobile as they are concentrating on car electronic equipment business. The LG Group expects reflected benefits from the electronic equipment of cars and electric vehicle market expansions. LG Electronics is also planning to dominate the electric vehicle market in advance through charging the battery pack business, etc.
In fact, LG Innotek’s sales in major automobile electronic equipment components including Battery Management System(BMS)·in-vehicle wireless communication components·automobile electronic equipment camera·Light Emitting Diode(LED) lighting etc. are on the rise. This year’s sales of LG Innotek automobile parts are estimated to reach 600 million dollars, which is higher than last year’s by more than 92 million dollars.
Senior Reporter Kim,Joonbae | joon@etnews.com, Staff Reporter Lee, Hyungsoo | goldlion2@etnews.com