LG Innotek to step on the accelerator pedal for smartphone cameras

Input 2021.02.18 09:44

Possibility of additional investment due to strong Apple iPhone sales

LG Innotek is investing 5478 billion won by the end of this year to expand smartphone camera production. This is because the sales of the optical solution division that makes smartphone cameras last year recorded 6.8 trillion won, or 70% of the company’s sales. It is interpreted that it will more firmly step on the accelerator pedal of growth this year.

According to LG Innotek on the 18th, this investment is to secure and strengthen competitiveness in the optical solution business. The new facility investment announced by LG Innotek on the previous day through the Financial Supervisory Service’s electronic disclosure system is KRW 5478 billion, equivalent to 24.9% of equity capital as of 2019.

Earlier in February of last year, LG Innotek announced that it would make a new investment of 479 billion won to strengthen its optical solution business, and this year the scale has grown even further.

LG Innotek plans to expand its product lineup into three main products. ▲Sensor shift camera module ▲Structured Light (SL) 3D sensing module ▲Flight time distance measurement (ToF) module, etc. All of these are being supplied to the Apple iPhone. Park Hyung-woo, senior researcher at Shinhan Investment Corp., said, “The sales growth will continue this year as the strong cooperative relationship with customers continues.”

This year’s single module camera average selling price (ASP) is expected to rise thanks to the increased introduction of sensor shift cameras. In addition, as the virtual reality (VR) and augmented reality (AR) markets expand, the demand for ToF modules is also expected to increase. It is observed that the sales growth of SL 3D modules will continue.

The stock market predicts that LG Innotek can make additional investments in addition to the new facility investment of KRW 5478 billion, which is scheduled for this year. This is because Apple, a major customer, has plans to continue to increase the camera performance of the iPhone.

“LG Innotek’s camera module facility investment is closely related to Apple’s camera module specifications,” said Jo Joo Joo, a researcher at Meritz Securities. Integration of the transmitter and receiver is expected.”

Researcher Joo said, “In the case of the Apple iPhone, there is still a lot of replacement demand, so the demand for the iPhone 13 will greatly outperform the iPhone 12 and reach a record level of sales.” There is also a possibility.”