[Featured Stock] Dongwha Enterprises, Samsung-Hyundai Motor 'Dream Battery' Collaboration Halts Tesla's Solo Run... Stock Price Premium Factor

[Asia Economy Reporter Hyungsoo Park] Dongwha Enterprise's stock price is rebounding. It appears that the news of Samsung Electronics Vice Chairman Lee Jae-yong visiting Hyundai Motor Company's Namyang Technology Research Center next week to meet again with Hyundai Motor Group Senior Vice Chairman Chung Eui-sun is influencing the stock price. It is expected that additional collaboration plans related to all-solid-state batteries, which were the main topic of the first meeting in May, will be discussed in the second meeting.

As of 9:17 a.m. on the 16th, Dongwha Enterprise is trading at 47,400 KRW, up 7.48% from the previous day.

According to business circles, Vice Chairman Lee is scheduled to visit Hyundai Motor Company's Namyang Technology Research Center in Hwaseong, Gyeonggi Province early next week to discuss the current status of future car development with Senior Vice Chairman Chung. The Namyang Technology Research Center is the heart of Hyundai Motor Group's research and development (R&D). The all-solid-state battery, known as the "dream battery," is expected to be commercialized around 2030. While Japan's Toyota holds the most advanced technology, it is analyzed that the gap will rapidly narrow through cooperation between Samsung and Hyundai Motor Group. Samsung Electronics and Hyundai Motor have shown steady interest in all-solid-state batteries, including investing in the U.S. battery startup 'Solid Power' in 2018.

Some in the business community analyze that if Samsung, the world's top semiconductor, display, and battery company, joins hands with Hyundai Motor Group, which is "all-in" on the future automobile market including hydrogen cars, they will become the strongest rival to Tesla's dominance.

Dongwha Enterprise acquired Panax Etec, which spun off from Cheil Industries, last year. It has started a secondary battery electrolyte business. It supplies electrolytes to Samsung SDI and SK Innovation. As the largest domestic electrolyte company in a market led by Japanese firms, it is expected to benefit from localization.

Researcher Jumin Woo of Meritz Securities explained, "Production capacity will increase from 33,000 tons last year to 61,000 tons next year," adding, "We expect performance improvement due to the production effect of the main customer’s Gen5 prismatic batteries."

He continued, "There needs to be a shift in perception from a building materials company to a secondary battery materials company," and suggested a target stock price of 70,000 KRW.

He emphasized, "The reason for the premium is that there is no risk regarding the technological shift to all-solid-state batteries, which will expand in 2025, but rather benefits," adding, "Dongwha Enterprise jointly developed the solid electrolyte, a core component of all-solid-state batteries, with its customers."

He analyzed, "They are also developing solid electrolytes by forming a consortium with battery companies," and "Ultimately, Dongwha Enterprise's market position will be further strengthened by the introduction of all-solid-state batteries."

He judged that the company has value-added factors compared to others with the same secondary battery sales ratio.