Why is Sekyung Hi-Tech Investing in UTG?

Sekyung Hi-Tech is entering the UTG market by acquiring a 46.67% stake in SEED GLOBAL PTE. LIMITED, a Singapore-based holding company, for ₩12.1 billion. This strategic decision aims to gain a foothold in the future display market, including foldable phones, and secure new growth engines through synergy with its existing film business. Securing UTG technology, a key material for the foldable display market, is expected to significantly contribute to strengthening Sekyung Hi-Tech’s future competitiveness.

Does UTG Investment Guarantee a Rosy Future?

Entering the UTG market isn’t without its downsides. The ₩12.1 billion investment could pose a financial burden for Sekyung Hi-Tech, which recently recorded an operating loss. Investors also need to consider the uncertainties of the early stages of the UTG business, intensifying competition, and rapidly changing market conditions. The weak KRW/EUR exchange rate could also be a burden for Sekyung Hi-Tech as an exporting company.

Key Checkpoints for Investors

  • Monitor UTG Business Performance: Continuously monitor the achievement of concrete results through cooperation with SEED GLOBAL.

  • Check Financial Soundness: Closely track changes in Sekyung Hi-Tech’s cash flow and financial status after the investment.

  • Watch Market Conditions: Assess Sekyung Hi-Tech’s response strategies by analyzing trends in the foldable and IT parts markets, as well as competitor analysis.

  • Analyze Macroeconomic Impact: Analyze the impact of macroeconomic indicators such as interest rates, exchange rates, and raw material price fluctuations on Sekyung Hi-Tech, and reflect this in your investment strategy.

Entering the UTG market is an important step for Sekyung Hi-Tech’s long-term growth. However, investors should be fully aware of the potential risks and make prudent investment decisions.