EcoPro BM Lowers Target Stock Price to 450,000 Won Amid 'Prosecutor Investigation Noise'

[Asia Economy Reporter So-yeon Park] Samsung Securities has lowered the target price of EcoPro BM to 450,000 KRW.

According to FN Guide on the 13th, Samsung Securities stated in a recent report on EcoPro BM that despite the fire at the Ochang plant, the annual growth for 2022 is expected to further expand.

Although the CAM4n and CAM4 lines are currently halted due to the fire at the Ochang plant in January, the fire investigation is concluding, and the CAM6, which started early mass production last year, is expected to be fully operational within February.

The CAM5 in Pohang, originally scheduled for mass production in the first quarter of next year, is also planned for early mass production, so the company expects no disruption to the originally planned sales.

Despite the continuous rise in major metal prices last year, even if there is an adjustment after the second quarter this year, the average selling price is expected to increase compared to the previous year.

Accordingly, Samsung Securities forecasts EcoPro BM's annual sales for 2022 to increase by 70% from the previous year to 2.5 trillion KRW, with operating profit expected to be 221.3 billion KRW.

Jang Jeong-hoon, a researcher at Samsung Securities, said, "The current stock price has fallen 45% compared to last year's peak, and when compared to after the fire on January 20, considering the noise related to the prosecution investigation, it has been adjusted by 30%. Although growth potential has been further strengthened, since the prosecution investigation involves the company's management, which the market dislikes, investor sentiment cannot fully reflect the fundamental improvements and inevitably applies a discount compared to before."