Kuen Tong expects strong momentum to remain

• By Meryl Kao / Staff reporter

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Precision metal processing and manufacturing company Kuen Tong Industrial Co (昆桐) said it expects strong business momentum to persist next year supported by its low Earth orbit (LEO) satellite-related business and liquid-cooling products for artificial intelligence (AI) servers.

The LEO business covers communications payloads, power systems, propulsion and attitude control, and structural components, Kuen Tong chairman Jeff Lin (林志中) said at a business presentation in Taipei yesterday.

In the first three quarters of this year, LEO satellite business accounted for about 67 percent of the company’s NT$1.53 billion (US$47.2 million) revenue, while bicycle-related products accounted for 24 percent and AI server liquid-cooling products at 6 percent, Lin said.

Kuen Tong Industrial Co chairman Jeff Lin poses for a photograph at a business presentation in Taipei yesterday.

Photo: CNA

Kuen Tong entered the satellite business in 2017 through a US customer and has since expanded from supplying small-volume ground receiver components into major structural parts and key satellite modules, he said.

The company has secured orders for satellite module-related components for a US customer’s next-generation satellites, Kuen Tong chief financial officer Vibi Shiu (徐絲綺) said, adding that mass production is expected to begin next year.

Kuen Tong said it expects AI server cooling to become its second growth engine after the company entered the business last year.

The company said it is already in volume production of liquid-cooling and manifold-related products for major customers, and its Thai plant has installed three production lines to support its expansion.

Kuen Tong said that it is expanding capacity in Taiwan and Thailand to meet robust demand for its satellite business and liquid-cooling products, as well as high-end precision metal components used in semiconductor production equipment.

Construction of a new plant in Thailand is expected to be completed in the third quarter of next year, with production capacity set to double by the fourth quarter, Kuen Tong president Eden Lin (林純芳) said.

In Taiwan, the company plans to raise capacity by 10 to 15 percent next year by renting facilities before completing its new plant in 2029, she said.

Factory utilization is 100 percent in Taiwan and about 70 percent in Thailand, she said.

Taiwan operations contribute 60 to 70 percent of the company’s revenue, she added.

Kuen Tong’s gross margin reached 45 percent, and earnings per share were NT$11.99 in the first three quarters. The firm is set to debut on the Emerging Stock Board today at a reference price of NT$390 per share.