Material, parts, equipment and fabless companies go public one after another
Continued growth in facility investment and R&D expansion
Good performance… increases confidence in listing
Despite concerns of a slowdown in the semiconductor sector, materials, parts, and equipment companies and fabless companies continue to have initial public offerings (IPO) one after another. Though the stock market has frozen over, it appears they are attempting to breakthrough head on for continued growth and as an investment for the future.
Materials, parts, and equipment companies like QRT, TFE, JI Tech, Justem, Enjet, and Pemtron, as well as fabless companies like Zaram Technology are scheduled to be listed on KOSDAQ. QRT pushed forward their status as the country’s only semiconductor analysis and credibility evaluation company. As semiconductors and their related parts become more cutting-edge, they are focusing on the comprehensive semiconductor analysis market. TFE is a semiconductor testing parts company. They focus on the production of test sockets, test boards, burn-in boards, and change over kits (COK).
JI Tech is a semiconductor material company that started with semiconductor precursors and expanded their business to recently include special gases. Justem supplies solutions for yield improvement through semiconductor contamination control, and electro-hydrodynamic inkjet solutions. Pemtron, which produces 3D precision measuring and testing equipment which are necessary for semiconductor and battery quality control, and Zaram Technology, a fabless communications semiconductor company, have both began initial public offerings.
As the stock market crashes as the economy goes through a recession in the second half of the year, the consensus of the industry is that it is difficult to guarantee a high public offering price even if they are listed. Despite this, semiconductor companies are pushing to be listed to lay the foundation for growth through facility investment and expansion of R&D. The semiconductor market is also facing a downturn compared to the previous year, but it can be seen that they plan to breakthrough with differentiated technology and production capabilities. As such, the fact that many companies revealed that they will use the public offering funds to develop new products and invest in facilities can be seen in the same vein.
JI Tech, which had a large proportion of sales with semiconductor precursors, have had a huge increase in sales from special gases this year. Their plan is to invest in facilities with funds from public offerings to respond to the rising market demands. Enjet is also expanding their infrastructure for the production of EHD multi nozzle equipment for micro processing.
As they had faced difficulties in securing a high-value workforce due to the lack of company awareness, they will solve the issue by being publicly listed. Young-boo Kim, the CEO of QRT, said that, “We plan to reinforce the R&D workforce, expand infrastructure, and strengthen market dominance.” As TFE prepares to be listed, they are also in the process of gaining a high-value workforce of people with masters and PhDs.
Though there are concerns for worse performance in semiconductor companies compared to the previous year, the companies that will be listed are not doing bad. Most of them have reached all of the sales goals of the first half of the previous year, and some of them have shown huge growth. JI Tech recorded 31.5 billion KRW in sales in the first half of the year, surpassing the sales for the entire previous year. Enjet also had sales reaching 11.5 billion KRW in the first half of the year, surpassing the sales for the entire previous year which amounted to 1.01 billion KRW.
A spokesman for the semiconductor industry said, “It looks like the sense of crisis of not being able to wait any longer even though the stock market is not looking great, played a part in pushing for public listing,” and analyzed that “the good performance of companies have added confidence in the listing.”
Reporter Dong-joon Kwon (djkwon@etnews.com) Reporter Ji-woong Kim (jw0316@etnews.com)