[Click eStock] "Cheonbo, Aggressive Expansion Expected to Drive Full-Scale Growth"

Secondary Battery Material Production Capacity, Which Was Only 1,560 Tons Last Year, Expected to Grow to 4,000 Tons This Year
Daishin Securities "Cheonbo, Target Price Raised from 240,000 KRW to 340,000 KRW"

[Asia Economy Reporter Gong Byung-sun] Cheonbo announced a large-scale expansion of its secondary battery material factory in the Saemangeum Industrial Complex. This is to respond to the increasing demand from customers for secondary batteries. Accordingly, the target stock price has also been significantly revised upward.

On the 19th, Daishin Securities stated that it maintains a 'Buy' rating on Cheonbo. The target price was raised from the previous 240,000 KRW to 340,000 KRW. The closing price on the previous day was 229,700 KRW.

Cheonbo's large-scale expansion plan led to the upward revision of the target price. Last month, Cheonbo signed a Memorandum of Understanding (MOU) to build a secondary battery material factory in the Saemangeum Industrial Complex. The plan is to invest approximately 500 billion KRW by 2026 to secure an annual production capacity of 20,000 tons of F electrolyte (LiFSI). LiFSI is a premium material that determines battery performance such as stability and lifespan, currently used in small mixed quantities.

Researcher Han Sang-won of Daishin Securities explained, "Recently, the price gap between LiFSI and general-purpose products has narrowed, leading to a significant increase in customer demand," adding, "This is the background for the aggressive expansion."

Cheonbo's secondary battery material production capacity is expected to improve significantly. The annual production capacity of secondary battery materials, which was only 1,560 tons last year, is projected to surge to 4,000 tons this year, 12,000 tons in 2023, and 27,000 tons in 2026. Sales from the secondary battery material business are also expected to increase from 76 billion KRW last year to 1 trillion KRW in 2026.

Meanwhile, Cheonbo's second-quarter sales are tentatively estimated at 60.4 billion KRW, up 79.3% year-on-year, and operating profit is expected to increase by 52% during the same period. Researcher Han said, "Although profitability of the secondary battery material business slightly declined due to raw material price increases, such as a 19% rise in lithium prices compared to the previous quarter, it was offset by sales growth," and forecasted, "Profitability recovery is also possible in the second half of the year through subsequent price increases."