Wisol, a surface acoustic wave (SAW) filter maker for mobile phones, will sell the Internet of Things (IoT) business. This is to focus on radio frequency (RF), the company’s core business, and new businesses by liquidating its business divisions in red.
In its announcement on 11th Wisol said that it will transfer the IoT business to Seong Ji Industrial Co., Ltd., a Surface Mount Technology (SMT) company. Wisol explained that the purpose of the business transfer is to improve profitability and financial soundness. The company will concentrate on its main business, RF and new businesses, and will raise funds to prepare for the 5G market. Although the transfer price is 4.1 billion won, the total transfer value is expected to reach 15 billion won if the company transfers its future inventory assets and the type and inventory assets of its Vietnamese subsidiary under a separate transfer contract.
Security firms are positive about Wisol’s decision to transfer the IoT business division. The division has been experiencing difficulties such as delays in the opening of the IoT module business. Kwon Hyul, a researcher at DB Financial Investment, said, “The IoT business of Wisol has suffered due to the delayed full-fledged expansion of its IoT module business for SK Telecom’s IoT dedicated network ‘LoRa’ and for ‘SigFox’ of France, in addition to the stagnation of sales growth in the TV and home appliance sales.” Min-Woo Joo, a researcher at Meritz Securities, said, “The (Wisol’s) IoT module recorded a one-digit loss in the last two years due to intensified competition with Chinese companies. With the transfer contract, it will be able to select and concentrate on their core business, 5G parts, as well as improving the profitability.”
Wisol is maintaining its competitiveness in SAW filter business. A SAW filter is located under the antenna of a mobile phone and passes only the frequencies required to make a call. In 4G, 40 to 50 SAW filters have been installed in the mobile; however, in 5G, the number is increased to 60-70 per mobile. This is because the frequency band that the mobile should receive increases in 5G. Wisol had the third largest global SAW filter market share in 2017. Murata (Japan) is number one, and the second place is taken by Broadcom (America). At the same time, Wisol is expected to generate sales from this year with bulk acoustic wave (BAW) filters, which are under development. A BAW filter has a relatively high-frequency response capability and is easy to miniaturize. BAW’s average selling price (ASP) is also five times that of SAW.
The sales figure of Wisol is expected to decline this year due to the transfer of the IoT division, but the profitability should improve. The IoT business sales accounted for 16.2% of the total sales. Wisol said, “Although there will be a temporary decrease in the top line, the qualitative improvement in the business structure is expected due to the sale of the deficit business.” Researcher Min-Woo Joo said, “After the transfer of the IoT business, the sales of Wisol will inevitably decrease from 434 billion won last year to 410 billion won this year. Yet, the operational margin will improve from 12 percent last year to 13-14 percent this year.”
Founded in 2008, Wisol is headquartered in Osan, Gyeonggi-do. Last year, their sales were 434 billion won and the operating profit was 52 billion won. It was listed on the KOSDAQ in 2010. Wisol was acquired by Daeduck Electronics in 2017.