SFA Engineering（056190 KS）持有第一季度回顾-缓慢复苏

Investment Rating - The report maintains a "Hold" rating for SFA Engineering with an unchanged target price of KRW21,000, reflecting the actual 1Q25 earnings and higher new order estimates for 2025 [5][8][13]. Core Insights - SFA Engineering reported 1Q25 earnings with an operating profit of KRW29 billion, turning to profit quarter-on-quarter but down 30% year-on-year, with sales of KRW398 billion, down 14% quarter-on-quarter and 47% year-on-year [2][22]. - New orders for SFA were KRW184 billion, 7% weaker than expected, with EV battery orders making up 67% of the total [2][5]. - The report anticipates a steady recovery in new orders for 2025, raising estimates by 22% to around KRW1 trillion, driven by recovery in equipment orders from battery customers and growth in display and semiconductor orders [3][5]. Financial Performance - 1Q25 sales were 8% lower than estimates due to weaker earnings at key subsidiaries, particularly in battery equipment installations and semiconductor outsourced assembly and testing [2][22]. - Profitability was 2% weaker than estimates due to poor performance at subsidiaries, although SFA Engineering recorded stronger margins of 11% compared to the estimated 9% [2][5]. - The report projects sluggish sales of KRW1.9 trillion for 2025, down 7% year-on-year, with an operating profit of KRW179 billion, indicating limited recovery at key subsidiaries [4][5]. Order Trends - The report highlights a recovery in battery orders, expected to increase by 16% year-on-year to KRW408 billion, driven by continued investment from Korean customers [14]. - Display orders are projected to double to KRW210 billion, fueled by robust demand in IT-OLED capacity expansion, particularly from Chinese customers [14]. - Semiconductor orders are expected to reach KRW229 billion, up 30% year-on-year, due to ongoing investments in back-end packaging capacity from Korean and US-based memory customers [14]. Valuation Metrics - The report introduces 2027 estimates and raises 2025/26 operating profit estimates by 9% and 1% respectively, maintaining a target PE multiple of 6.7x [5][9]. - The target price implies a downside of approximately 3.9% from the current share price of KRW21,850 [8][50]. - Financial ratios indicate a projected PE of 8.7x for 2025 and a dividend yield of 2.5% [9][17].