[Inside Ecopro] Production Capacity Quadruples and Sales Triple in 4 Years... Still 'Some Steps' Left

Sales Expected to Reach 10.1 Trillion Won and Operating Profit Near 1 Trillion Won This Year

EcoPro BM to Increase Anode Material Production from 180,000t to 710,000t
Targets Annual Sales of 27 Trillion Won in 4 Years
Precursor Production Quadrupled and Raw Material Extraction Increased Sixfold

EcoPro Group, a domestic leader in battery cathode materials, plans to nearly quadruple its production capacity within the next four years. Along with this, its performance and cumulative order volume graphs are expected to rise sharply.

EcoPro's cumulative sales for the first half of this year reached KRW 4.0776 trillion. The consensus forecast for EcoPro's consolidated annual sales this year, as predicted by domestic securities firms, is KRW 10.1298 trillion, nearly doubling last year's sales of KRW 5.6397 trillion. The annual operating profit forecast is KRW 948 billion, approaching KRW 1 trillion. (F&Guide data) However, the results for the first and second quarters of this year were slightly below market expectations (consensus). This was due to a decline in prices of key raw materials such as lithium and nickel, which are used in cathode materials, affecting the selling price.

EcoPro Group is building a circular ecosystem centered on cathode materials, from extracting and processing raw materials to recovering lithium and nickel from used batteries.

The growth of EcoPro BM, the cathode material production subsidiary that currently accounts for most of EcoPro Group's sales, is remarkable. EcoPro BM plans to increase its cathode material production capacity from the current 180,000 tons to 710,000 tons annually by 2027. The annual sales target for four years later is set at over KRW 27 trillion. EcoPro Materials, a precursor manufacturer of cathode material raw materials, also plans to expand its precursor production capacity fourfold. The number of precursor production and raw material extraction plants will increase from the current four to eight. By 2027, precursor production capacity will rise from 50,000 tons to 210,000 tons, and raw material extraction capacity will increase nearly sixfold from 36,000 tons to 207,000 tons.

There is also potential for additional cathode material supply contracts with battery cell companies. Anna Lee, a researcher at Yuanta Securities, said, "In the second half of this year, expectations for additional orders are rising, starting with cathode material supply to the LG Energy Solution-Hyundai Motor joint venture in the U.S." She added, "We expect momentum for orders and expansions centered on cells and cathode materials to continue in the second half." Major customers such as Samsung SDI and the GM joint factory are also continuing to secure orders. The Hungarian cathode material plant, with a capacity of 100,000 tons, is scheduled to supply Samsung SDI and Germany's BMW, with mass production starting in the second half of next year for Plant 1 and the second half of 2025 for Plant 2.

However, it is important not to forget the possibility of a decline in cathode material prices. Byung-Hwa Han, a researcher at Eugene Investment & Securities, said, "We need to monitor the expansion status of competitors." He noted, "The expansion of Canadian cathode material plants by cathode material company Umicore, investments by Japanese cathode material companies centered on Panasonic, and Chinese companies' investments in Europe could impact cathode material prices."