[Featured Stock] Jokwang Paint Officially Enters 10 Trillion Won Secondary Battery Materials Market... "Profit Levels Will Change"

[Asia Economy Reporter Hyungsoo Park] Jogwang Paint is showing strong performance. It appears that the corporate value is being re-evaluated as it transforms into a secondary battery material company.

As of 9:54 AM on the 15th, Jogwang Paint is trading at 11,950 KRW, up 16.02% from the previous day.

Earlier, Shinhan Financial Investment expected on the 8th that Jogwang Paint would officially enter the high-growth thermal interface material (TIM) market starting from the fourth quarter of this year.

Researcher Mingoo Jung of Shinhan Financial Investment explained, "Jogwang Paint has been developing thermal adhesive materials (TIM) through its subsidiary CK EM Solution," adding, "They have built a product portfolio based on urethane, epoxy, and silicone materials."

He added, "Starting from the second half of this year, they will begin supplying to major domestic cell makers," and "Thermal adhesive materials for secondary batteries are expected to be produced in earnest from the fourth quarter at domestic factories as well as new factories in Poland and the United States."

Researcher Jung anticipated that related sales would increase by replacing overseas suppliers' volumes.

TIM (Thermal Interface Material) is a thermal material mainly used in electronic devices. It is widely used from IT devices to secondary batteries. Especially with the high integration of IT devices and the advent of the electric vehicle era, the global TIM market is expected to grow at an average annual rate of 12.5% until 2028, reaching a market size of approximately 7 billion USD (9.7 trillion KRW).

This year, sales are estimated to reach 263.1 billion KRW, with an operating profit of 2.8 billion KRW. Sales represent a 10.3% increase compared to the previous year, and operating profit is expected to turn positive. Operating profit is projected to reach 16.8 billion KRW in 2023 and 21.9 billion KRW in 2024.

Researcher Jung stated, "Operating profit is expected to turn positive due to the expansion of margin spreads in existing industrial coatings and the contribution of new business sales," and added, "As the proportion of high-margin new business sales increases significantly from the fourth quarter, a clear structural improvement as a secondary battery material company will be evident in 2023."