[THE INVESTOR] LG Display’s small-sized organic light-emitting diode panels have the potential to become an alternative to the products of Samsung Display currently dominating the market, according to local analysts here.
“It is inevitable for Apple and Google to view LG Display as an alternative because Samsung’s dominance in the flexible OLED market can be a threat to the firms struggling to secure the panels,” said Lee Min-hee, an analyst at Heungkuk Securities, in its latest report, which also revised up the company’s share price by 25 percent to 47,000 won (US$41).
Samsung Securities and Dongbu Securities also revised up the share price by 26 percent and 20 percent, respectively, to 44,000 won and 42,000 won.
Apple, which recently shifted to OLED panels for its upcoming iPhone 8, has to solely rely on its handset rival Samsung for the supply. But the US tech giant will ultimately seek multiple vendors in the future, as reliance on a single vendor is too risky, industry watchers predicted. Apple is reportedly in talks with LG Display to verify the firm’s capacity to mass produce flexible OLED panels.
Google also talked with LG Display to invest 1 trillion won in an OLED production line, allegedly to secure the panels for its upcoming smartphone Pixel, according to recent news reports. Last year, the US search giant unveiled its Pixel phone featuring OLED panels, but it failed to ship an adequate supply of the smartphones due to a panel supply issue.
Anaysts predicted LG Display’s small-sized OLED business would continue to grow by expanding its client base into Chinese handset makers and automotive companies alongside Apple and Google.
“LG’s flexible OLED business will pick up steam in the third quarter as it is expected to supply the panels to a global smartphone maker and an automotive company,” said Soh Hyun-chul, an analyst at Shinhan Investment.
Although he did not specify the names of the companies, LG will reportedly supply its flexible OLED to Chinese handset maker Xiaomi and German luxury carmaker Mercedes-Benz, according to industry watchers.
Soh predicted LG Display’s OLED sales will increase from 2.5 trillion won this year to 10.1 trillion won in 2019, making a turnaround with an operating profit of 1.1 trillion won.
By Shin Ji-hye/The Korea Herlad (firstname.lastname@example.org)