[Click eStock] Amogreentech, Electric Vehicles Lead and ESS Push... Expectations for Next Year

[Asia Economy Reporter Lee Seon-ae] NH Investment & Securities analyzed on the 6th that Amogreentec's high-efficiency magnetic materials and energy storage system (ESS) businesses are driving growth, and are expected to continue performing well in the second half of the year and next year. However, no investment opinion or target price was provided.

High-efficiency magnetic materials are core components that enhance power efficiency by minimizing energy loss based on characteristics such as high permeability and low eddy current loss. Amogreentec has been supplying high-efficiency magnetic materials to Tesla for the past three years. Since then, based on this reference, the company has recently expanded its customer base to include Rivian, GM, and domestic automakers. This year, sales of high-efficiency magnetic materials are expected to reach 52 billion KRW, a 39% increase from the previous year.

Researcher Kang Kyung-geun of NH Investment & Securities stated, "Due to increased electric vehicle output and diversification of customers, high growth of around 30-40% is expected to continue next year."

The ESS business is beginning to deliver overseas projects in earnest. Amogreentec is conducting an ESS business based on lithium iron phosphate (LFP) batteries. ESS sales in the first half of the year reached 15.4 billion KRW, a 117.4% increase compared to the same period last year. Thanks to projects converting locomotives from diesel to electric in advanced countries such as Australia and the United States, the addition of a major Japanese telecommunications company to existing domestic telecom customers, and exclusive supply to a Danish wind power system company, performance growth is expected to accelerate in the second half of the year.

Researcher Kang said, "With accelerated growth in high-efficiency magnetic materials and the ESS business, second-half sales are expected to reach 101.9 billion KRW (53.6% increase), operating profit 10.38 billion KRW (381.7% y-y, operating margin of 10.2%), recording strong performance," adding, "With various promising new business items such as AMB Substrate (ceramic substrate for SiC power semiconductors) and nano membrane water treatment filters, 2023 performance is forecasted at sales of 221.8 billion KRW (29.2% increase), operating profit of 24 billion KRW (55.4%, operating margin 10.8%)."