[Edaily Reporter Shin Ha-yeon ] On the 8th, DB Securities maintained its “Buy” investment rating for LGELECTRONICS(066570)and raised its target price by 69% from 145,000 won to 245,000 won, noting that the company not only posted second-quarter earnings that significantly exceeded market expectations but is also set to accelerate the expansion of its artificial intelligence (AI) and robotics businesses, which are built on its home appliance foundation.

Cho Hyun-ji, an analyst at DB Securities, stated, “Ultimately, LGELECTRONICS’ business portfolio is demonstrating robust performance led by home appliances, while simultaneously showing expectations for expanded earnings momentum and higher valuation multiples through the expansion of its air care-focused robotics portfolio and increased supply of chillers for AI data centers (AI DCs).”

Analyst Cho explained, “Second-quarter consolidated revenue is estimated at 23.8297 trillion won, and operating profit at 1.2578 trillion won—results that significantly exceed consensus estimates,” adding, “Stand-alone operating profit, excluding LG Innotek, is estimated at 1.3157 trillion won.” He continued, “The primary reason for the strong performance was the reflection of refunds for customs duties paid in the previous year,” adding, “The refund amount is estimated to be around 400 billion won, with the refund for HS—which accounted for the largest portion—likely reaching approximately 300 billion won.”

He analyzed, “Even excluding the refund, standalone operating profit based on pure operating performance is estimated at around 900 billion won, representing an increase of more than 40% compared to the same period last year,” adding, “The continued expansion of HS’s B2B and home appliance subscription services, cost control—including logistics expenses—and strong sales of high-value-added TVs during the World Cup season all contributed to the company’s strong performance.”

He also projected that the trend of improved performance would continue into the second half of the year. Analyst Cho stated, “Given that some of the typical cost expenditures for the second half appear to have been partially reflected in advance due to the robust operating performance in the second quarter, we expect the seasonal slowdown during the off-season in the second half to be somewhat mitigated.”

He added, “Furthermore, as the heating and cooling market itself is expected to expand in Europe—where air conditioner penetration rates are low—we can anticipate an increase in ES cargo volume even against a higher year-over-year base.”

Researcher Cho added, “We are raising the target price to 245,000 won,” noting, “The target price-to-book ratio (Target PBR) is based on 1.9x, which was the peak PBR recorded between 2021 and 2025.”