[Click eStock] "SKIET, Operating Profit to Triple by 2025"

[Asia Economy Reporter Park So-yeon] Yuanta Securities on the 11th forecasted that SK IE Technology (SKIET) will see its operating profit grow about threefold over five years, reaching approximately 500 billion KRW by 2025. Last year's operating profit was 125.2 billion KRW.

SKIET is a separator production company that plays a role in reducing fire risks among secondary battery materials and ranks third globally. Its main products consist of 56% separators for electric vehicles, 43% separators for IT applications, and 1% Flexible Cover Window (FCW).

The major customers are SK Innovation Co., Ltd. (26%), LG Energy Solution Ltd. (37%), and others (37%, including Japan's Panasonic Corporation). The largest shareholder is SK Innovation Co., Ltd., holding a 60% stake.

Researcher Hwang Gyu-won of Yuanta Securities analyzed, "The global separator demand volume (including wet and dry types) over five years is expected to grow 3.9 times, from 4.1 billion square meters in 2020, 5.5 billion square meters in 2021, 8.2 billion square meters in 2022, 10.6 billion square meters in 2023, 13.2 billion square meters in 2024, to 15.9 billion square meters in 2025."

Researcher Hwang stated, "SKIET is also aggressively expanding its facilities aiming for over 15% of the global market share," adding, "The capacity is planned to expand from 530 million square meters in 2019, 870 million square meters in 2020, 1.38 billion square meters in 2021, 1.55 billion square meters in 2022, 2.32 billion square meters in 2023, to 2.75 billion square meters in 2024, growing 5.2 times over five years."

Thanks to capacity expansion from 2020 to 2025, operating performance is expected to increase 2.9 times. Estimated operating profits are 192.1 billion KRW in 2021, 298.7 billion KRW in 2022, 367.1 billion KRW in 2023, 431.2 billion KRW in 2024, and 484.9 billion KRW in 2025.

Researcher Hwang Gyu-won said, "After listing, the stock price is expected to undergo an overshooting process and converge to its fair value within 3 to 6 months," adding, "Using the discounted cash flow (DCF) method to calculate future earnings at present value, the fair stock price range is 100,000 to 160,000 KRW until the threat of all-solid-state batteries becomes significantly prominent."