PI Advanced Materials H1 2025 Earnings Analysis

PI Advanced Materials’ H1 2025 earnings disappointed across the board, with revenue, operating profit, and net income all missing market expectations. Revenue came in at ₩72.4 billion, 4% below the estimated ₩75.6 billion, while operating profit and net income also declined by 7% and 16%, respectively.

Reasons for Underperformance

The primary reasons for this underperformance are attributed to the declining revenue trend observed over the past three years, compounded by decreased overseas sales in Q2 or weak domestic sales. Amidst this ongoing underperformance, concerns are also rising about the company’s long-term growth prospects, as R&D investment has also slightly decreased to 3.5% compared to the same period last year.

Investment Strategies

Short-Term Perspective

In the short term, investors should be cautious of potential stock price declines due to the disappointing earnings. Continuous monitoring of performance improvements and a prudent investment approach are recommended.

Mid- to Long-Term Perspective

Over the mid- to long term, investors should focus on positive factors such as the company’s robust financial health, growth in overseas sales, and the expansion of the EV-dedicated PI varnish production line. A strategy of waiting for the re-evaluation of corporate value while monitoring R&D investment expansion, new market development, and litigation risk management could be effective. Additionally, continuous observation of changes in the macroeconomic environment, such as exchange rate volatility and rising logistics costs, is crucial.

Action Plan for Investors

  • Short-term investors: Maintain a wait-and-see approach until signs of performance improvement emerge.
  • Mid- to long-term investors: Monitor growth drivers and risk management capabilities.
  • All investors: Maintain ongoing awareness of changes in the macroeconomic environment.