Author: Tronserve admin
Thursday 5th August 2021 02:18 AM
Techwing’s Test Handler Business on Upswing on Chip And Equipment Upgrades
Kosdaq-listed TechWing stock has been on a roll as an increase in investment into assembly and testing equipment by big name semiconductor manufacturers will likely benefit the world’s largest test handler maker despite the COVID-19 pandemic around the world.
A test handler is a device used to move semiconductor chips to a tester, an inspection device, for performance testing. The equipment also performs temperature control for testing or classification of defective products.
TechWing reported an earnings surprise in the first quarter with revenue jumping 93.7 percent to 54 billion won ($44 million) and turning operating profit positive to 9.7 billion won which topped a market consensus of 8.2 billion won. The robust performance is expected to continue throughout next year.
Despite concerns over the global semiconductor industry, an initial investment cycle for handlers for automating SSD testing by overseas clients has started amid strong demand for NAND flash investment, while handler investments for 5G communication chips and other non-memory chips are growing in the outsourced semiconductor assembly and test market, said Han Dong-hee, an analyst at Kiwoom Securities. On top of this, ongoing investment in foldable smartphone inspection equipment in expected to benefit TechWing’s subsidiary ENC Technology, the analyst said.
Market watchers forecast TechWing’s operating profit for this year will surpass its previous record of 41.5 billion won tallied in 2017. According to FnGuide, TechWing’s expected operating profit could reach 43.8 billion won this year over sales of 239.8 billion won on a consolidated basis.
TechWing has also diversified its portfolio into handlers for SSD and non-memory chips and burn-in sorters. If the company wins orders for SSD burn-in test chambers in the future, its sales will be comparable to those in memory handlers of today, said DB Financial Investment analyst Eo Gyu-jin.
The company’s stock price already reflects the expected sales growth with a strong rebound from 8,900 won on Mar. 19 to 16,500 won on May 6. DB Financial Investment upgraded its target price in its Monday report for investors from 15,000 won to 21,000 won.