LG Chem Surges on Positive News... Stock Price Also Smiles

ITC Issues Early Loss Ruling Against SK Innovation in Trade Secret Infringement Lawsuit

[Asia Economy Reporter Kum Bo-ryeong] LG Chem is experiencing a wave of positive developments.

On the 17th, according to LG Chem, the U.S. International Trade Commission (ITC) decided on the 14th (local time) to issue an early loss ruling against SK Innovation in the trade secret infringement lawsuit related to secondary batteries.

This decision is expected to further highlight momentum for LG Chem's stock price. Although the ITC's final decision will be announced in October this year, in the past 25 years, 100% of ITC preliminary decisions in trade secret lawsuits have been upheld in the final decision. In patent lawsuits, 90% of preliminary decisions matched the final decision, so the likelihood of change in the final decision is low. On the day, LG Chem's stock rose to 422,500 KRW, marking a 52-week high.

Baek Young-chan, a researcher at KB Securities, analyzed, "Uncertainties such as increased costs due to patent lawsuits and opportunity costs arising from lawsuits among domestic companies are expected to decrease further," adding, "If an agreement is reached between the two companies, it is expected to be positive for LG Chem in the short term." If LG Chem and SK Innovation reach an agreement, a certain scale of capital inflow is anticipated for LG Chem.

Along with the lawsuit ruling, LG Chem is receiving a series of positive factors. Recently, as investment sentiment related to electric vehicles has strengthened, LG Chem is in a market-friendly situation. With Tesla's global sales forecast being revised upward and Europe's electric vehicle sales forecast also rising, expectations for growth in the global electric vehicle market ahead of the third-generation electric vehicle sales are increasing.

Additionally, expectations for a spin-off have overlapped. It is scheduled to spin off the battery business division within this year and is known to simultaneously pursue an initial public offering (IPO).

Accordingly, Samsung Securities raised the target stock price for LG Chem. It was adjusted upward by 27% from 410,000 KRW announced on the 3rd to 520,000 KRW on this day.