[Special Stock] Secondary Battery Declines Amid Tesla Shock

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] Domestic secondary battery stocks are all falling due to concerns over Tesla's earnings.

As of 9:20 a.m. on the 4th, LG Energy Solution is trading at 425,500 KRW, down 3.41% (15,000 KRW) from the previous day. Samsung SDI is down 1.98% at 593,000 KRW, SK Innovation is down 1.99% at 147,500 KRW, and POSCO Chemical is down 3.47% at 181,000 KRW.

Concerns over earnings arose as Tesla's Q4 deliveries came in at 405,278 units, below market expectations of 427,000 units. As a result, Tesla closed sharply down 12.24% on the New York Stock Exchange the previous day.

In particular, LG Energy Solution is interpreted as experiencing weakened investor sentiment due to last year's Q4 poor earnings and concerns over employee stock ownership plan (ESOP) overhang.

Park Jin-soo, a researcher at Shin Young Securities, said on the day, "LG Energy Solution's operating profit for Q4 last year is expected to be 368 billion KRW, down 29% from the previous quarter," adding, "This is below the market consensus operating profit estimate of 480 billion KRW."

Researcher Park analyzed, "The main reasons for the profit decline compared to the previous quarter are the lower KRW-USD exchange rate since November, employee incentive payments, and the use of expensive raw materials."

Also, the upcoming release of the lock-up on 7.925 million shares held by the employee stock ownership association on the 27th is dragging down the stock price. This accounts for 3.39% of the total listed shares but represents 23.1% of the actual circulating shares.