LS Materials, Emerging as a Comprehensive Beneficiary Company in New Industries like Electric Vehicles, Secondary Batteries, and Wind Power

"We decided to proceed with the initial public offering (IPO) to prepare for the explosively growing market."

On the 28th, Hong Young-ho, CEO of LS Materials, stated at a corporate briefing held in Yeouido, Seoul, "Even after listing, we will play a key role in the carbon-neutral value chain and establish ourselves as a comprehensive beneficiary stock covering various front-end markets," explaining the purpose of the listing.

LS Materials was established in 2021 through a physical division of LS Mtron's eco-friendly energy (UC) business division. The main product of the eco-friendly energy business division is medium- and large-sized ultra-capacitors (Ultra Capacitor, hereafter UC), high-output energy storage devices used in various fields such as renewable energy power generation, electric vehicles, industrial emergency power, and smart factories.

Globally, only a very few companies focus on researching and producing high value-added medium- and large-sized UCs rather than small capacitors. LS Materials has secured competitiveness through technological superiority.

Compared to lithium-ion batteries, UCs have lower energy storage capacity but higher output and very short charge/discharge times within 5 minutes, attracting attention as substitutes or supplements to existing batteries. With a cycle life exceeding 1 million times and energy efficiency over 95%, UCs have differentiated advantages and are increasingly used in various business sectors such as wind power generation and UPS (Uninterruptible Power Supply), with rapidly growing demand.

Subsidiary LS ALSCO manufactures aluminum materials and components, including automotive and IT parts, industrial materials, and hydrogen fuel cell components. Leveraging alloy material technology accumulated over approximately 50 years since 1973 and unique aluminum alloy new material identification numbers exclusively held domestically, the company has expanded its product lineup with outstanding technological capabilities.

The company supplies products to industrial materials, electrical and electronic component materials, and essential materials related to automotive parts, emphasizing aluminum’s light weight, high electrical conductivity, and strong corrosion resistance. In particular, PA12-coated tubes related to automotive parts and EV vehicle air conditioning components are expected to benefit from the high growth trend of the front-end industry.

Earlier this year, LS Materials established a joint venture, HAIMK, with Austria’s HAI, a global top-tier company in electric vehicle aluminum parts, to enter the electric vehicle battery system market.

The global electric vehicle-related market is rapidly growing, and especially the electric vehicle extrusion material supply market is facing a shortage of supply that cannot meet the explosive demand caused by increased mass production. HAIMK aims to quickly enter the domestic electric vehicle battery system market, achieve growth, and realize high corporate value.

Hong Young-ho, CEO of LS Materials, said, "With the establishment of the joint venture with global top-tier HAI, the company’s business will be reorganized focusing on electric vehicle parts. By bringing in the technology and know-how of HAI’s European production line, we expect to not only supply exclusively to the domestic electric vehicle battery system market but also expand overseas, anticipating a steep sales increase after initial product production."

LS Materials’ consolidated performance for 2022 recorded sales of 161.9 billion KRW and operating profit of 14.4 billion KRW, achieving significant growth of approximately 280% and 470% respectively compared to the previous year (2021). The cumulative performance for the third quarter of this year is sales of 100.6 billion KRW and operating profit of 10.7 billion KRW.

The total number of shares offered is 14,625,000, with a price band of 4,400 to 5,500 KRW. The total expected offering amount is between 64.3 billion and 80.4 billion KRW. The funds raised through the offering will mainly be used for ▲ establishing an integrated UC production facility and expanding capacity (capa) ▲ research on new products such as lithium-ion capacitors and electric vehicle charging systems.

The offering price will be finalized on the day. General public subscription will be conducted on December 1 and 4, with the listing scheduled for mid-December. The joint lead managers are KB Securities and Kiwoom Securities, and the underwriting companies participating are Ebest Investment & Securities, Hi Investment & Securities, and NH Investment & Securities.