Clinching contracts with new customers abroad has raised market watchers’ expectations on the growth of BHflex, a flexible printed circuit board provider based in South Korea. 

According to the financial industry on Monday, the company’s sales and operating profit for next year are estimated to surge compared to this year as it received new overseas orders. 

The FPCB manufacturer is forecast to post 376.1 billion won ($321.8 million) in sales by the end of the year, and 13.4 billion won in operating profit. Annual sales are estimated to hover around 650 billion won in 2017, while the operating profit is expected to double to around 35 billion won as well, according to market consensus. 

FPCBs are a key component of electronic products as devices get smaller and lighter, enabling flexible interconnections of parts in digital electronics ranging from smartphones, tablet PCs and eBook readers to automobile and aerospace equipment.

Kim Kyung-rok, an analyst at Hana Financial Investment, boosted his target price for BHflex from the current 11,400 won by 67 percent to 17,500 won, citing excitement for the company’s rapid growth in the coming year. “BHflex is one of few companies that can supply FPCBs in the country,” Kim said. “As the industry has been through restructurings, there are few remaining as active market players. The survivors are now starting to grow.” 

Kim said firms that can produce FPCBs for display panels, like BHflex, are rare, and will be the biggest beneficiaries of growing overseas demand.

More good news for investors arrived last week that BHflex might be an exclusive supplier of display FPCBs for the Galaxy S8 series by Samsung Electronics, slated for launch next March.

According to local media reports, BHflex signed a contract with Samsung to provide Y-OCTA FPCBs, a combined type of display FPCBs and touch screen panel FPCBs. The Y-OCTA module is known as a smartphone part that helps reduce manufacturing costs, which does not require the attachment of an additional touch sensor film. 

Starting from a nadir of 4,100 won in June, the firm’s share value has been rising steeply for the past five months. After hitting a new high of 13,400 won last Thursday, the price continued hovering around the 13,000 won. It closed at 12,250 won on Monday. 

“Since it is a listed firm, we can’t confirm whether it is a done deal or not until the new product is officially launched,” a spokesman at Samsung Electronics told The Korea Herald.

Founded in 1999 and headquartered in Bupyeong, Gyeonggi Province, BHflex has been making efforts to expand into foreign markets.

The company is running sales offices in Tokyo and San Jose, California, and operating production facilities in Shandong Province, China and Vinh Phuc, Vietnam.

BHflex’s major customers worldwide include Japan Display Inc., Hitachi, Sony, Sharp, Xiaomi, Coolpad and BOE. The company, however, declined to name new buyers. 

By Song Su-hyun (song@heraldcorp.com)