Samsung Electro-Mechanics and LG Innotek surge as they ramp up core businesses and secure future robot parts

Samsung Electro-Mechanics and LG Innotek are continuing their sharp stock gains as the artificial intelligence (AI) semiconductor market expands.Samsung Electro-Mechanics closed at 2,127,000 won on the 29th, after its stock price more than doubled in a single month. LG Innotek also hit a record high that day, rising to as much as 1,474,000 won during intraday trading. The rally has been driven by both earnings and future growth potential. As higher-performance AI accelerators boost demand for semiconductor substrates and power components, the two companies' core businesses are growing together. Industry watchers expect their earnings improvement to continue for the time being, supported by stronger investment in AI servers and a sustained boom in related component markets.
According to industry sources on the 31st, Samsung Electro-Mechanics is seen as one of the biggest beneficiaries of the AI semiconductor boom. Demand for its flagship products, multilayer ceramic capacitors (MLCC) and flip-chip ball grid arrays (FC-BGA), has surged alongside the expansion of the AI server market. Industry estimates suggest current demand for MLCCs and FC-BGAs exceeds production capacity by more than 30 percent and 50 percent, respectively. As a result, Samsung Electro-Mechanics' MLCC production lines are already running at full capacity, and FC-BGA utilization is expected to reach 100 percent starting in the third quarter of this year.
MLCCs, often called the "rice of the electronics industry," are directly benefiting from the growth of the AI server market. Recent demand has outpaced supply, strengthening the company's pricing power. Samsung Electro-Mechanics has also invested 180 billion won to expand its FC-BGA plant in Vietnam and respond to additional demand. In addition, it recently signed a 150 billion won supply deal for silicon capacitors with a major global company.LG Innotek is also developing FC-BGA as a future growth engine. Its revenue structure still relies heavily on smartphone camera modules, but starting this year, the company plans to expand its business around its Package Solution Business, which includes semiconductor substrates.
Both companies are also focusing on robot components, including humanoids, as a future growth area and are working hard to secure customers. Samsung Electro-Mechanics plans to begin mass production of humanoid robot eyes in the second half of this year and then expand into the actuator segment, a key part of robots. LG Innotek is also expected to begin supplying vision sensing modules this year to major humanoid companies such as Figure AI Inc., Boston Dynamics and Tesla.
soup@fnnews.com Lim Su-bin Reporter