LG Innotek is a company where camera modules for a major customer's premium smartphones make up about 83% of revenue, and it is shifting the center of gravity of its profits toward higher-margin semiconductor substrates (package solutions) and auto components (mobility solutions), which carry an order backlog of ₩19.2 trillion. Q1 2026 delivered record quarterly results, with total revenue of ₩5.5348 trillion and operating profit up 136%, and in June the company unveiled a mid-to-long-term plan to grow its semiconductor-substrate operating profit to around ₩1 trillion by 2031 and to invest about ₩1 trillion in a Vietnam plant through 2028. The recent picture is two-sided: the strengths are earnings recovering quickly off a trough and diversification into a substrate business riding AI demand, while the caution is the structural limit that more than 80% of revenue depends on camera modules for a small number of large customers.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt ratio, current ratio and interest burden all look healthy.
- Revenue rose 3.3% year over year, and the pace is quickening (3-year trend: rising).
- Most recent quarter (Q1 2026) revenue was 11.1% higher than a year earlier.
- ROE is 5.9% (controlling-interest basis). It is above the sector average.
- Operating margin is 3.0%.
- The P/E sits above the sector median, reflecting elevated expectations.
Ownership & governance As of 2025-12-31
Largest shareholder LG Electronics 40.79% (corporate)
Controlling bloc incl. related parties 40.8%
With the controlling bloc holding 41%, the ownership structure is stable.
🔎 In-depth analysis
- LG Innotek's core business is making the camera modules that go into smartphones.
- As of Q1 2026, of total revenue of ₩5.5348 trillion, the optical-solutions unit that handles camera modules accounted for ₩4.6106 trillion, about 83%, with high-performance cameras for a major customer's premium smartphones at the center of revenue.
- The second pillar is the package-solutions (semiconductor substrate) business, which connects semiconductors to substrates and makes high-value substrates such as RF-SiP, FC-CSP, and FC-BGA; Q1 revenue was ₩437.1 billion, up 16% from a year earlier.
- The third is mobility solutions, which makes automotive lighting, sensors, and the like (₩487.1 billion), with an order backlog reaching ₩19.2 trillion that secures mid-to-long-term revenue in advance.
- In sum, it is a structure that earns large revenue from smartphone cameras while shifting the center of gravity of its profits toward higher-margin semiconductor substrates and auto components.
- The recent closing price is ₩741,000 and the market cap is ₩17.5 trillion.
- The price sits below its 20-day moving average (₩992,050) and below its 60-day average (₩845,475).
- Trading below both its short- and medium-term moving averages, the trend is on the soft side.
- The RSI (a supporting gauge that scores the strength of gains versus losses over the past 14 days on a 0-100 scale) is 34.2, a neutral level.
- The one-month change is -32.0%, the three-month change is +127.6%, and the position relative to the 52-week high is -51.6%.
- Relative strength versus KOSPI is 93 (on a 1-99 scale that weights recent returns against the index over the past year more heavily; higher means stronger than the market).
- That places it near the top 6% of all stocks by strength.
- Over the past three months it led the index by 72.0%.
- It is best to read the chart alongside trading volume and the dates of disclosures.
- Based on confirmed results for last year (2025), the P/E (how many times a year's earnings the price is worth) is 51.39x, which looks high, but this figure comes from a small denominator because 2025 net profit was a weak ₩341.3 billion.
- For a company whose earnings have just passed an inflection point, a P/E based on last year's results has the limitation of making it look more expensive than its actual value.
- The P/B (how many times net assets the price is worth) is 3.04x, and the P/S (how many times revenue the price is worth) is about 1.0x.
- Profitability is still on the low side, with ROE (how much is earned in a year on equity) at 5.9% and an operating margin of 3.0%, because 2025 was an earnings trough; both are improving quickly in 2026.
- On the balance sheet, the debt ratio (debt relative to equity) is 107%, around the manufacturing average, and with a current ratio of 150% and an interest coverage ratio of 3.5x, its short-term repayment capacity and ability to cover interest are stable.
- The dividend yield is a low 0.2% (₩1,880 per share), so this is a stock valued on earnings recovery rather than on dividends.
- Over the past three years revenue rose gently (₩20.6T in 2023 → ₩21.9T in 2025), but operating profit and net profit actually declined in a slowing phase (net profit ₩565.2 billion in 2023 → ₩341.3 billion in 2025).
- Then in Q1 2026 the trend shifted sharply.
- Revenue rose 11.1% from a year earlier to a quarterly record, operating profit surged 136% to ₩295.3 billion, and net profit jumped 168% to ₩229.1 billion.
- The quality of earnings changed to the point that a single quarter's Q1 net profit reached 67% of the whole of last year's net profit.
- Two forces drove the recovery: first, camera-module demand held firm even in the off-season and average prices rose as high-spec cameras were adopted in new smartphones for the second half; second, favorable supply of high-value semiconductor substrates whose demand grew with the spread of AI.
- Because LG Innotek's Q1 is a seasonal off-season and the second half, when new smartphones launch, is its peak season, earning this much profit in the off-season points to the possibility that full-year profit will rise sharply versus last year.
- Reflecting this, the P/E on this year's expected earnings is around 26x, far below the 64.6x on last year's results, a different picture from the 'expensive' impression the prior-year numbers gave.
- Disclosures and company announcements show two threads: an earnings recovery and a strengthening of the substrate business.
- The Q1 preliminary results disclosed in April 2026 and the quarterly report in May confirmed record quarterly revenue and a 136% rise in operating profit, and in May the company held an institutional investor briefing (IR) to explain the recovery directly.
- In June it held a package-solutions (semiconductor substrate) Tech Day and unveiled a mid-to-long-term plan to grow this business's operating profit to around ₩1 trillion by 2031 and to invest about ₩1 trillion in a Vietnam plant through 2028.
- Presenting high-difficulty AI-server substrates (FC-BGA) and next-generation glass substrates as growth pillars, the direction of lowering dependence on camera modules and shifting the center of gravity toward more profitable substrates is clear.
- The strength is that earnings are recovering quickly off a trough.
- Operating profit rose 136% in the off-season Q1, and with the peak-season second half still ahead, the valuation on this year's expected earnings (about 26x) is far more reasonable than the one on last year's results (64.6x).
- On top of that, the higher-margin semiconductor-substrate business is growing on AI demand, gradually diversifying a structure singularly dependent on camera modules, which is also positive.
- On the other hand, the point to watch is the structural limit that more than 80% of revenue is camera modules and effectively depends heavily on a small number of large customers.
- Accordingly, the smartphone sales trend at those major customers and whether they adopt new camera specs drive the results.
- It is also worth bearing in mind that the share price has risen steeply in a short time, making volatility high.
- In sum, it is a structure that is strong in an environment where new smartphone camera specs rise and AI-substrate demand continues, and weak in a phase where sales at major customers slow.
🔎 Valuation vs peers Fairly valued
The peer set is domestic electronic-component makers that handle both smartphone components and semiconductor substrates, with Samsung Electro-Mechanics the closest peer as a maker of MLCCs, substrates, and camera modules.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Samsung Electro-Mechanics | 157.93x | 11.69x | 7.40% |
| Samsung Electronics | 36.72x | 3.83x | 10.43% |
The closest peer, Samsung Electro-Mechanics, also shows a very high P/E on last year's results (210x), a result of the whole component sector passing an earnings trough that shrank the denominator. LG Innotek's 64.6x P/E on last year's results is in the same vein, largely reflecting a weak 2025 net profit. Reflecting the 136% surge in Q1 operating profit and the peak-season second half still ahead, on this year's expected earnings the valuation comes down to around 26x, not a burdensome level compared with the peer set. The P/B, at 3.8x, is also far below Samsung Electro-Mechanics (15.6x). On last year's results alone it looks expensive, but reflecting the earnings recovery we judge it to be in a fair range.
Price history Close · MA20 · MA60
The latest close is ₩741,000 and the market capitalization is ₩17.5 trillion. The price sits below its 20-day moving average (₩992,050) and below its 60-day moving average (₩845,475). It is under both its short- and medium-term moving averages, so the trend looks subdued. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 34.2, a neutral level. The one-month change is -32.0%, the three-month change is +127.6%, and the position relative to the 52-week high is -51.6%. Relative strength versus the KOSPI is 93 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 94% of all stocks. Over the past three months it outpaced the index by 72.0%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Relative performance stock vs index · start = 100
Excess return vs index · 3M +71.97% / 6M +70.96% / 12M +102.74%
Key metrics vs whole-market median
Valuation
The P/E of 51.39x is above the whole-market median (13.81x). The P/B of 3.04x is above the whole-market median (1.15x). That said, this P/E is based on last year's (trailing) results. With recent quarterly earnings up sharply, the trailing P/E can look higher than it really is, so a precise read is best done on this year's expected (forward) earnings.
Enterprise value (EV)
EV = market cap + net debt. It reflects cash and debt, so it captures the real cost of the whole business that market cap alone misses; lower multiples are cheaper relative to earnings or sales.
Intrinsic value (DCF estimate)
DCF (discounted cash flow) estimate — discount rate 11.0%, initial growth 4.0%→terminal 2.0%, 10-yr forecast, free-cash-flow basis. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 5.9%, above the whole-market average (5.0%). The operating margin is 3.0%. The debt ratio is 107.0%, so the financial structure is moderate.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $13.7B | $14.1B | $14.5B | +3.28% ↑ faster |
| Operating profit | $550.6M | $467.9M | $440.7M | -5.81% ↑ faster |
| Net profit | $374.6M | $297.8M | $226.2M | -24.04% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $9.9B | $13.0B | $13.7B | $14.1B | $14.5B |
| Operating profit | $837.9M | $842.9M | $550.6M | $467.9M | $440.7M |
| Net profit | $582.5M | $647.4M | $374.6M | $297.8M | $226.2M |
| Revenue CAGR | 4-yr avg 10.02% | ||||
Revenue rose 3.3% year over year (2023 ₩20.6 trillion → 2024 ₩21.2 trillion → 2025 ₩21.9 trillion), and the three-year trend is 'rising'. The pace of growth also quickened from the prior year. Operating profit fell 5.8% year over year. That said, the decline narrowed. Over the 5 years on record, revenue compound annual growth (CAGR) is 10.0%. The two-year revenue CAGR is 3.1%. In the most recent quarter (Q1 2026), revenue was 11.1% higher than the same period a year earlier.
Latest quarterly results Q1 2026 · vs year-ago
Technical indicators
What stands out
- The balance sheet is stable in terms of debt and liquidity.
Points to watch
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-04-27EarningsQ1 2026 revenue of ₩5.5348 trillion (a quarterly record) and operating profit of ₩295.3 billion, up 136% year on year, with net profit up 168%A surge in earnings even in the off-season confirms the earnings-recovery inflection. A key near-term event that shows the limits of the high P/E based on last year's results. Source
- 2026-05-11IRDisclosure of an institutional-investor briefing (IR)A venue to explain the Q1 recovery and business strategy directly, strengthening communication on business direction. Source
- 2026-05-14FilingQ1 2026 quarterly report filed. Segment results disclosed: optical solutions ₩4.6106 trillion, package solutions ₩437.1 billion, mobility solutions ₩487.1 billionConfirms the business mix and segment growth (substrates +16%, optics +11%). Supports the medium-term trend of a rising substrate weighting. Source
- 2026-06-16IRPackage-solutions (semiconductor substrate) Tech Day held. Mid-to-long-term strategy unveiled to grow this business's operating profit to around ₩1 trillion by 2031 and invest about ₩1 trillion in a Vietnam plant through 2028Presents high-value AI-server substrates (FC-BGA) and next-generation glass substrates as growth pillars. Over the medium to long term, a direction of lowering camera dependence and raising profitability. Source
Figure cross-check computed ↔ external
| Metric | Computed | External | Status | Source |
|---|---|---|---|---|
| Market cap | ₩17.5 trillion | ₩17.5 trillion | Confirmed | link |
| Q1 2026 operating profit | ₩295.3 billion | ₩295.3 billion | Confirmed | link |
| Sum of Q1 2026 segment revenue | revenue 5₩534.8 billion | 46,106 + 4,371 + 4,871 = 55,348 | Confirmed | link |
| Estimated 2026 full-year net profit | approx. ₩850.0 billion(self-estimate) | — | Unverified | — |
Recent filings
- 2026-06-01Large-business-group status disclosure
- 2026-06-01Corporate governance report
- 2026-05-15PeriodicQuarterly report (amended)
- 2026-05-14PeriodicQuarterly report
- 2026-05-11Disclosure
- 2026-04-27EarningsFair-disclosure notice
- 2026-04-27OwnershipOfficers'/major-shareholders' holdings report
- 2026-04-08OwnershipOfficers'/major-shareholders' holdings report
- 2026-04-03EarningsEarnings disclosure
- 2026-04-01OwnershipOwnership-change filing
- 2026-03-23Disclosure
- 2026-03-23Shareholders' meeting notice
📖 Plain-language glossary — expand if you are new to this
- P/E
- How many times a year's net profit the price is worth (lower is cheaper relative to earnings). The P/E here is on trailing (last full-year) results; for companies whose earnings swing fast (memory chips and other cyclicals/high-growth), a forward P/E on this year's expected earnings is more accurate.
- P/B
- Price relative to net assets (equity). Around 1x means it trades near book value; below 1x means below book.
- P/S
- Price relative to a year's revenue — useful for growth companies with thin earnings.
- Net debt / EV
- Net debt = interest-bearing debt − cash. Negative means more cash than debt (net cash). EV (enterprise value) = market cap + net debt, closer to what it would cost to buy the whole business.
- EV/EBIT · EV/EBITDA · EV/Sales
- Enterprise value against operating profit (EBIT), EBITDA, or revenue. Unlike P/E these reflect debt and cash; lower is cheaper relative to earnings power or sales.
- FCF / FCF yield
- Free cash flow = operating cash − capex, the cash actually left over. FCF yield = FCF ÷ market cap; higher means more cash generated per unit of market value.
- Intrinsic value (DCF)
- Future free cash flow (or, for some capex-heavy but profitable names, forecast earnings) discounted to today to estimate per-share value. Because it shifts a lot with the discount-rate and growth assumptions, it is shown as a bear/base/bull range, and the basis and assumptions are disclosed in one line beneath it.
- ROE
- How much profit the company earns in a year on its equity (%). Higher means better returns on capital.
- EPS / BPS
- Earnings per share / net assets (book value) per share.
- Operating / net margin
- Profit left from the core business / final profit after tax and interest, per unit of revenue.
- Debt ratio
- Debt relative to equity (%). Higher means more reliance on borrowing (norms vary by sector).
- Current ratio
- Assets convertible to cash within a year against debt due within a year. Above 100% leaves some short-term headroom.
- Interest coverage
- How many times operating profit covers the interest owed. Below 1x means operating profit alone struggles to cover interest.
- Dividend yield / payout ratio
- The year's dividend as a % of today's price / the share of earnings paid out as dividends.
- Revenue CAGR
- Multi-year growth expressed as a single yearly average (compound annual growth rate).
- RSI (short-term signal)
- Whether recent price action is overheated or beaten down. Above 70 is overbought, below 30 oversold.
- MA20 / MA60 (moving averages)
- The 20- and 60-day average price. Price above them signals a firmer short-term trend.
- vs 52-week high
- How far below the past year's peak the price sits now (%).
All figures are for reference only; how they read varies by sector and over time.
Sources: Korea FSC market-price API (data.go.kr), OpenDART, KRX/KIND — public data only.
Bong Stocks presents public-data-based information for reference only. It is not investment advice and contains no target prices, ratings, or buy/sell recommendations. Verify independently before making any decision.