[Click eStock] Samsung SDI, Automotive Battery Challenges Expected in Q4 This Year

[Asia Economy Reporter Junho Hwang] DB Investment Securities maintained its target price of 920,000 KRW and a buy rating for Samsung SDI on the 20th.

DB Investment Securities lowered its forecast for Samsung SDI's operating profit in Q4 this year from 418 billion KRW to 393.9 billion KRW. While the performance of the automotive battery segment was below expectations, the ESS (Energy Storage Solution) and small battery segments are expected to perform slightly better than anticipated.

In the automotive battery segment, the shortage of vehicle semiconductors has limited production volumes in the finished car industry, negatively impacting battery shipments. However, the black ink trend that began in 2Q21 is expected to continue due to an increase in the proportion of Gen5 and a reduction in fixed cost burdens.

Next year, as delayed orders are reflected normally, automotive battery sales are expected to increase by 40%, and the surplus scale of medium-to-large batteries is expected to grow further.

Seongryul Kwon, a researcher at KB Investment Securities, said, "If more concrete details about the investment in automotive batteries in the US are announced early next year, growth potential will be spotlighted again," adding, "Although the stock price has recently been adjusted due to slightly lower-than-expected Q4 performance, concerns about performance variables due to CEO replacement, and supply-demand concerns related to the listing of LG Energy Solution, the stock price can rebound anytime once growth potential is proven."