[KR-2차전지] 05/20 Korea Market Insights

LG Energy Solution’s recent contract to supply 46-series cylindrical batteries to BMW marks a significant strategic milestone. This deal, estimated at approximately 10 trillion KRW, validates the company’s technological competitiveness in the next-generation battery segment and provides a crucial revenue anchor amidst a volatile EV market.

While the company reported a first-quarter operating loss, the accumulation of a massive order backlog (440GWh+) for the 46-series suggests that the firm has successfully passed the cyclical trough. Securing a major European OEM like BMW reinforces LG Energy Solution’s market leadership and provides a clear path toward margin recovery as production scales. Investors should view this as a pivotal transition from short-term earnings pressure to long-term structural growth driven by high-margin, high-performance battery demand.

EcoPro BM’s Q1 preliminary results indicate a significant year-over-year recovery in Operating Profit (+823%), primarily driven by a surge in ESS (Energy Storage System) cathode material sales. However, the top-line revenue remains under pressure due to the ongoing EV market slowdown and fluctuations in metal prices.

While the company is strategically pivoting its capital expenditure—prioritizing European expansion while re-evaluating North American LFP investments—the stock continues to face technical headwinds, as evidenced by its persistent presence among the top Short Selling targets. Investors should monitor whether the shift toward ESS and the ramp-up of the Hungary plant can offset the volatility in the core EV battery sector.

POSCO Future M is demonstrating strong strategic momentum, evidenced by its inclusion in the DJSI World Index—a first for the domestic battery materials sector—which underscores its commitment to ESG management and global competitiveness. Furthermore, the company is actively diversifying its portfolio and securing future growth engines through the expansion of LFP (Lithium Iron Phosphate) battery materials and the establishment of a new anode material production base in Vietnam. While short-term earnings volatility remains a concern, the increasing visibility of new orders and proactive capacity expansion provide a solid foundation for long-term valuation re-rating.

L&F is demonstrating a robust turnaround, driven by a successful (Dual-track strategy) that integrates high-nickel (NCM) cathodes with cost-competitive (LFP) materials. The company’s Q1 performance, which exceeded market expectations, signals a successful pivot toward operational efficiency and diversified product portfolios. By securing visible contracts for its LFP segment, L&F is effectively mitigating risks associated with EV market volatility and strengthening its competitive positioning in the global supply chain. The upward revision of target prices by major brokerages reflects growing confidence in the company’s ability to sustain (Profitability) and capture emerging demand in the entry-level EV market.

Samsung SDI is currently navigating a pivotal transition period characterized by strategic client diversification and long-term capacity expansion. The recent announcement regarding the first-time battery supply agreement with Mercedes-Benz serves as a critical catalyst, validating the company’s premium P6 prismatic battery technology and reducing its historical reliance on specific legacy partners.

While concerns regarding capital expenditure (CAPEX) and debt levels—highlighted in recent external audit reports—remain a point of scrutiny, the market is increasingly shifting its focus toward the upcoming rebound cycle in the EV sector. The significant stock price appreciation and strong investor returns underscore confidence in the company’s disciplined financial management and its ability to secure high-margin contracts. As the industry moves toward a recovery phase, Samsung SDI’s focus on high-performance, high-value-added products positions it favorably to capture market share among European luxury OEMs.