TSE (131290) Trailed for Continued 2Q26 Earnings Rally via DRAM Market Entry and Board Segment Expansion: Investment Metrics Analysis

Source Facts: DS Investment & Securities Research Center (Based on the report published on July 2, 2026)
Investment Rating & Target Price: BUY / KRW 360,000 (Newly initiated, Based on the current price of KRW 276,000)
Key Momentum: Expansion of the probe card portfolio from NAND into high-value DRAM (DDR4, DDR5, HBM3E, etc.) and steep revenue growth in the board division tied to front-end capital expenditure cycles.

[Key Investment Metrics & Valuation Data]

Target Price: KRW 360,000
Investment Rating: BUY
Valuation Rationale: Calculated by applying a Target P/E of 20.4x to the 2027 expected) of KRW 17,637. This reflects the successful entry into high-entry-barrier tech supply chains and securing of new anchor accounts.

[Annual Forecast Key Highlights]

Full-Year 2026 Forecast (E):
- Consolidated Revenue: KRW 647.0 Billion (YoY +51%)
- Consolidated Operating Profit: KRW 175.3 Billion (YoY +256% / OP Margin 27.1%)
Full-Year 2027 Forecast (E):
- Consolidated Revenue: KRW 894.0 Billion
- Consolidated Operating Profit: KRW 245.7 Billion (YoY +40% / OP Margin 27.5%)

[2Q26 Earnings Preview]

Consolidated Estimates: Operating profit is projected at KRW 44.0 Billion (QoQ +4%, OPM 29%), extending the strong earnings trajectory observed in the first quarter through structural revenue optimization.
Earnings Stream Characteristics: 1Q26 performance was assisted by one-off factors (KRW 1.35 Billion in bad debt provision reversals) and KRW 18.0 Billion in OLED inspection equipment revenue. In 2Q26, despite the absence of the equipment sales, pure semiconductor component growth is expected to push quarter-on-quarter operating profit higher.

[Divisional & Consolidated Subsidiaries Momentum]

Probe Card Division: Pivoting from its traditional NAND-heavy mix, the company has secured two global DRAM suppliers as new clients. Shipments now span DDR4, DDR5, and HBM3E lines, with ongoing development for next-generation HBM4/4E architectures. Due to high technical entry barriers, annual probe card revenue is projected to hit KRW 218.0 Billion (YoY +52%).
Board Division: Demand for interface and burn-in boards is moving in sync with clients’ tech transitions and capital expansion cycles, securing continuous replacement demand on a roughly 5-year cycle. Annual board revenue is projected at KRW 159.0 Billion (YoY +68%) with an expected operating margin exceeding 35%.
Key Subsidiaries: Tiger Elec is projected to mark record-high metrics (Revenue: KRW 119.0 Billion / Operating Profit: KRW 23.8 Billion) backed by surging probe card PCB demand and price increases. Megatouch is on track for a structural turnaround (Revenue: KRW 68.0 Billion / Operating Profit: KRW 8.2 Billion), escaping last year’s large one-off asset impairment charges.

The defining inflection point in TSE’s current data trajectory is the structural transformation of its margin profile through aggressive product mix diversification. Moving past the volatile NAND-centric dependency and establishing a firm foothold in high-difficulty DRAM and HBM3E architectures fundamentally validates a valuation multiple expansion. Crucially, as highlighted in the Q2 preview, the core business maintains an outstanding 29% operating margin even as temporary display equipment revenue drops out. Supported by a comprehensive turnaround across core subsidiaries and a high-margin (>35%) structure within the board segment, the full-year consolidated operating profit target of KRW 175.3 Billion (YoY +256%) rests on highly reliable, data-backed operational pillars.

Source: This content has been newly structured and written based on financial facts and numerical data from officially disclosed securities research reports.
Investment Risk Notice: This content is provided solely for informational and linguistic reference purposes. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the individual investor.
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