Doosan’s Electro-Materials BG scoffs at the AI bubble theory as operating profit surges 126%

[Financial News] Doosan’s share price has recently come under pressure amid concerns about slowing investment in artificial intelligence (AI), but its core business, the Electro-Materials BG (Electronics Business Division), has posted record results. Analysts say that as shortages of high-value copper-clad laminate (CCL) for AI semiconductors persist, the business has also secured the pricing power to pass higher costs on to customers.
On the 10th, Yang Seungsoo, a researcher at Meritz Securities, said Doosan’s recent share-price correction was significantly at odds with its actual business conditions and drew attention to the potential for a revaluation of the company.
According to Meritz Securities, Doosan’s Electro-Materials BG recorded revenue of 802 billion won in the third quarter, up 82.4% from a year earlier. Operating profit surged 126.5% to 235.3 billion won. The operating margin was 29.3%, and is estimated to have exceeded 30% excluding the impact of the stronger won.
The company’s results were driven by increased supply to a major North American AI semiconductor customer. Sales to that customer reached a record high, and sales of products for networking and optical modules also rose sharply. Despite higher raw-material costs, price increases, particularly for high-value-added products, helped protect profitability.
The shortage of high-end CCL is also a favorable factor. Yang said, “Supply-chain uncertainty has risen following a fire at a Japanese competitor’s factory in Taiwan, further strengthening the supplier-favorable market.” He added, “Although the direct spillover benefits are limited, this is expected to have a positive impact on Doosan’s entry into the application-specific integrated circuit (ASIC) supply chain.”
Concerns that existing key customers may diversify their supply chains are also considered excessive. Analysts say that CCL for AI computing has high technical barriers to entry because semiconductor packages are becoming larger, making it likely that Doosan will retain its exclusive-supplier position for next-generation products as well.
The optical-module market is another growth driver. As the product mix, currently centered on 400G and 800G, shifts to 800G and 1.6T in 2027, the share of high-value-added products and profitability are expected to rise.
Yang said, “Compared with the valuations of Taiwanese CCL manufacturers, Doosan’s current market capitalization does not even fully reflect the value of its Electro-Materials BG.” He added, “A gradual revaluation of the company is expected as a new entry into the ASIC supply chain and capacity expansion through a joint venture (JV) with Chinese customers become more tangible.”


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