TLB to benefit from SK Hynix’s Intel NAND unit purchase 

TLB will begin producing printed circuit boards for DDR5 DRAM memory next year, the company CEO said on Thursday.

TLB CEO Baek Seong Hyeon said the company will also begin production of PCBs for enterprise solid-state drives (SSD).

It will also enter the PCB market for semiconductor production equipment, Baek said.

The firm recently wrapped up development of DDR5 memory module PCB that it will supply to customer SK Hynix. 

SK Hynix began commercial production of DDR5 DRAM last month. It said demand from big data, artificial intelligence and autonomous driving will drive growth for the memory.

Baek stressed that memory market’s outlook is optimistic from rise in data usages and traffic. DDR5 boasts double the data transfer rates of DDR4.

TLB’s memory module PCB accounts for 34% to 35% of those used by SK Hynix.

SK Hynix’s acquisition of Intel’s NAND unit is expected to further benefit TLB. NAND sales are larger than DRAM sales. 

TLB, which will be listed on KOSDAQ on December 14, said it will use the funds to build a new DDR5 PCB factory. It will spend 28.4 billion won in the new factory.

When the factory in completed in 2022, the firm’s monthly production capacity will increase from 27,000 meter-square to 40,000 meter-square. 

Its rivals Simmtech and Korea Circuit’s monthly production rate currently stands at 50,000 meter-square and 35,000 meter-square, respectively.

TLB’s overseas rival include Unimicron and Tripod Technology of Taiwan.

These PCB firms compete for orders from Samsung Electronics, SK Hynix and Micron.

TLB recently finished development of its enterprise SSD PCB which will go into production next year. TLB’s PCB accounts for 30% of those used for SSD by Samsung last year and up to the first half of 2020.

The firm also developed automatic test equipment wafer board and automatic test equipment final test board for semiconductor equipment.

TLB’s weakness is that its memory module PCB business, which accounts for 60% of its sales, is effected by gold prices. Around 15% of the cost for memory module PCB is used in gold plating. Gold price per ounce increased from US$1,400 earlier this year to US$1,800 right now. Prices are expected to go up more next year.

TLB was formed when it was split-off from Daeduck Electronics in 2011. CEO Baek has been leading the company since then.

Last year, the company posted 149.1 billion won in sales and 11.1 billion won in operating income. In that year, SK Hynix accounted for 52.5% of its sales, followed by Samsung Electronics’ 29.1%.

TLB is offering a million shares in its IPO. Its asking price for the shares is between 33,200 won to 38,000 won. It will secure up to 38 billion won in funding. DB Financial Investment is underwriting the deal.