[Asia Economy Reporter Hyungsoo Park] Nara M&D is showing strong performance. It appears that the news of LG Chem ranking first in the global electric vehicle (EV, PHEV, HEV) battery usage rankings for batteries sold from January to August this year has influenced the stock price.
As of 10:39 AM on the 6th, Nara M&D is trading at 11,850 KRW, up 9.72% from the previous day.
According to market research firm SNE Research, LG Chem's global electric vehicle battery usage from January to August this year was recorded at 15.9 GWh. This accounted for 24.6% of the total electric vehicle battery volume (64.7 GWh) during the same period, holding the highest market share.
China's CATL ranked second with 15.5 GWh (24.0%). Japan's Panasonic took third place with 12.4 GWh (19.2%). Samsung SDI and SK Innovation ranked 4th and 6th respectively, with market shares of 6.3% and 4.2%, placing them within the top 10.
The secondary battery market is expected to grow alongside the increase in electric vehicle sales. Daishin Securities forecasts that global eco-friendly vehicle demand will reach 26.41 million pure electric vehicles by 2025, accounting for 26.6% of global vehicle sales. Currently, electric vehicles make up only about 2% of the global automobile market. The electric vehicle market has recorded an average annual growth rate of 52% over the past five years and is expected to grow approximately 35% annually over the next five years.
Established in 1999 by spinning off the mold factory from LG Electronics' Production Technology Center, Nara M&D specializes in manufacturing molds and parts for automobiles and home appliances. As a new business, it produces battery pack components for electric vehicles and supplies them to LG Chem. CEO Youngjo Kim and the largest shareholder hold 14.99% of the shares, while LG Electronics owns 12.57%. CEO Youngjo Kim joined LG Electronics in 1967 and served as the head of the Production Technology Center. He is leading the battery pack business and is known as LG Chem's largest battery pack supplier.
To mass-produce electric vehicle battery packs, Nara M&D established Nara Moso Technology Co., Ltd. in Nanjing, China, in June 2016. In January 2018, it established Nara Battery Engineering Poland Ltd. in Wroclaw, Poland. The company trades with globally renowned automotive parts manufacturers such as DELPHI and DENSO. It maintains a close business relationship with LG Chem, which competes for the top 1-2 positions worldwide in the electric vehicle battery sector.
Researcher Chansol Park of SK Securities introduced, "Nara M&D is a key battery pack supplier for LG Chem," adding, "To focus on supplying battery packs and ESS components to LG Chem, Nara Moso Technology Nanjing Co., Ltd. was established in China in 2016."
He continued, "In 2018, Nara Battery Engineering Poland Ltd. was established, and the factory began operations in November 2019," explaining, "Demand for battery pack components from LG Chem's medium and large battery factory in Poland is expected to increase."
He added, "Margins related to secondary batteries are expected to be formed at 9-10%. With the mass production of Volkswagen's electric vehicle ID.3, starting the expansion of the European electric vehicle market, there appears to be no demand issues for battery packs from the Poland factory."
Researcher Sangheon Lee of Hi Investment & Securities explained, "Nara M&D produces electric vehicle battery pack injection parts at its domestic, Nanjing (China), and Poland factories and supplies them to LG Chem and others," adding, "Nara Battery Engineering Poland Ltd., which is 100% invested by Nara M&D, started supplying LG Chem's Poland subsidiary from the fourth quarter of last year through a dedicated production line."
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