[Click eStock] "Amogreentech Shows High Growth Every Year... Target Price Maintained"

Hana Securities maintained a buy rating and a target price of 20,000 KRW for Amogreentech on the 1st, stating that "high growth is expected every year."

On the day, Kyu-sang Kim, a researcher at Hana Securities, said, "The earnings per share (EPS) forecasts for this year, next year, and 2025 are 710 KRW, 958 KRW, and 1,351 KRW respectively, indicating high growth every year," and added, "The valuation (stock price level relative to corporate value) attractiveness is expected to stand out due to the rise in EPS."

He also said, "This year's sales are expected to reach 154.1 billion KRW, an 8.4% increase from last year, and operating profit is expected to record 12.6 billion KRW, a 42.1% increase," adding, "Next year's sales are projected to increase by 30% from this year to 200.4 billion KRW, and operating profit is expected to rise by 70.2% to 21.4 billion KRW. The high-efficiency magnetic components and energy storage system (ESS) divisions will drive growth."

Amogreentech is recently considered a beneficiary of Tesla's Cybertruck. It has supplied high-efficiency magnetic components to Tesla electric vehicles for several years and has now established this as a core business division. Sales of high-efficiency magnetic components recorded significant growth every year, from 25.2 billion KRW in 2020 to 37.4 billion KRW in 2021, and 48.2 billion KRW last year. Researcher Kim said, "Sales this year are expected to be 56.9 billion KRW and 82.2 billion KRW next year," adding, "Along with the increase in sales of high-efficiency magnetic components, the operating profit margin has risen from mid (4-6%) to high (7-9%) single digits since last year, and is expected to exceed 10% next year."

Amogreentech operates an ESS business based on lithium iron phosphate. It is the exclusive supplier for Progress Rail, a subsidiary of Caterpillar, for electric locomotives. It also secured orders worth 20 billion KRW from Progress Rail. Future orders for electric locomotives are expected to continue increasing due to factors such as 'minimizing volatility caused by rapid diesel price hikes' and 'corporate decarbonization policy promotion.' Amogreentech also supplies ESS required for uninterruptible power supplies (UPS) at communication base stations. Recently, it succeeded in securing lithium iron phosphate (LFP) ESS orders from American Tower in the U.S. Researcher Kim said, "American Tower owns communication base stations and leases them to telecom companies, operating more than 190,000 base stations across North America, Asia, Europe, and Africa as of 2021," adding, "Amogreentech will first introduce LFP ESS in Africa and Latin America with American Tower, and expansion to other regions is expected in the future."