South Korean component maker SoluM is setting up offices abroad to better react to demand from customer Samsung Electronics.
The company set up its office in Noida, India in September. The office, which will focus on production, will go live next year. SoluM is planning to operate an office in Mexico next year.
SoluM was founded in 2015 after splitting off from Samsung Electro-Mechanics. It produces module module for TVs and smartphones as well as electronics shelf labels.
Its 3 in 1 module for TVs, which combines a power module, tuner and a video board, brings in around half its sales.
The company will be producing this 3 in 1 module at Noida, India. It was previously produced in South Korea, Vietnam and China. However, as its customer Samsung Electronics begin lowering the product output at its TV factory Tianjin, SoluM beginning shift its production there to Vietnam and India.
Vietnam accounts for the majority of SoluM’s production.
Sales from the 3 in 1 modules this year is expected to be around 500 billion won, while this is expected to increase to 700 billion next year. Samsung Electronics uses the modules for its low to mid-tier TVs. SoluM is the largest supplier of the modules for Samsung’s low to mid-tier TVs.
In power modules, SoluM is competing with Hanson Technics.
SoluM’s new office in Tijuana, Mexico will focus on producing video boards. These will be supplied to Samsung Electronics’ TV factory nearby.
SoluM’s move to open new offices in India and Vietnam was also partly done to decrease uncertainties over US and China’s trade war.
However, Samsung Electronics is expected to reduce the volume of chargers it gave to customers for free in the box for smartphones. SoluM’s sales from the chargers is expected to go down going forward.
SoluM and Dong Yang E&P have been the supplier of the chargers to Samsung. Samsung is planning to have flagship and mid-tier smartphones support wireless charging modules. SoluM is planning to sell the chargers separately.
SoluM is planning to list on KOSPI next year.
CEO Jun Sung Ho owns 16% share of SoluM. Samsung Electro-Mechanics has 11.64%. Private equity fund KB Stonebridge Secondary owns 9.58%.
Jun previously worked as an executive at Samsung, having worked at the smartphone CMOS image sensor business and digital module business.
SoluM is expected to post sales of 1 trillion won this year. Last year, the company posted 913.6 billion won. As of the third quarter, the firm’s accumulated sales stood at 813 billion won and operating income 45.7 billion won this year.