[Click eStock] "'ESS Daegangju' Seojin System... Investment Opinion Buy"

On the 30th, Daishin Securities gave a "Buy" rating and set a target price of 41,000 KRW for Seojin System, stating that "benefits are expected from the steep growth of the Energy Storage System (ESS) market." The closing price on the previous day was 32,400 KRW.

On the same day, Park Jang-wook, a researcher at Daishin Securities, said, "Along with growth in the ESS sector, sales of electric vehicle and battery parts are also expected to expand with the growth of the electric vehicle market."

First, the expansion of renewable energy has increased the need to store electricity wasted during the daytime. Researcher Park said, "Looking at the total operating costs of peak power plants (power plants that respond to sudden increases in electricity demand beyond base load) over 30 years in some regions of the United States, the economics of solar power and Battery Energy Storage Systems (BESS) are estimated to have surpassed those of gas plants."

The increase in orders and profits from client companies is expected to lead to improved performance for Seojin System. In particular, the full-scale growth of the ESS market has begun, led by regions in the United States such as California where large-scale solar power installations exist. Researcher Park explained, "Following California, the renewable energy market has expanded in Texas, Virginia, and other areas. The ESS market will also expand accordingly," adding, "According to S&P Global, the annual global installation volume of ESS is expected to grow about 5 to 7 times by 2030 compared to last year."

In the electric vehicle market, the application of ultra-large casting methods for cost reduction is also expected to expand. Researcher Park noted, "Seojin System, which has proactively secured 9,200-ton and 12,000-ton die casting equipment, holds competitiveness," and "With large-scale die casting equipment, an expansion of orders in the ultra-large die casting sector from global electric vehicle manufacturers is anticipated." The ultra-large die casting method significantly reduces the assembly and welding of multiple parts by manufacturing and assembling products in 12 to 14 units.

He added, "This year, sales in the ESS sector are expected to grow 159% year-on-year to 711.4 billion KRW, driving performance growth," and "If customers for ultra-large die casting are secured, the growth of electric vehicle and battery parts could be steeper than previously estimated."