[Click eStock] "EcoPro BM, Limited Downward Pressure on Stock Price"

Hana Securities diagnosed on the 4th that the downward pressure on the stock price of Ecopro BM is limited. They maintained a 'neutral' investment rating and a target price of 153,000 KRW.

Ecopro BM reported Q3 sales of 521.9 billion KRW, a 71% decrease compared to the same period last year, and an operating loss of 41.2 billion KRW during the same period. Hyunsoo Kim, a researcher at Hana Securities, explained, "Due to the slowdown in electric vehicle demand, the battery sales of major customers in Q2 were sluggish, and Ecopro BM's cathode material shipments also decreased by 35% compared to the previous quarter. Inventory assets incurred an evaluation loss of 18.8 billion KRW as the KRW-USD exchange rate declined and lithium hydroxide prices also fell."

Researcher Kim stated regarding Ecopro BM's fair value, "Reflecting the global slowdown in electric vehicle demand and the easing of fuel efficiency regulations, long-term expansion plans of electric vehicle, cell, and cathode material companies are being revised downward. It is highly likely that Ecopro BM's existing production capacity (CAPA) forecasts will also be adjusted downward." He added, "Assuming about a 10% downward adjustment, the long-term maximum value in 2030 is 32 trillion KRW, and based on discounted present value, it is 24 trillion KRW." He further said, "Since this is based on overly aggressive assumptions, we propose a fair value of 15 trillion KRW, which is the average of the 6 trillion KRW valuation based on the 2026 earnings forecast."

However, Researcher Kim added, "Since the year-on-year sales growth rate is likely to turn positive from Q3 next year, considering the six-month lead time for a performance turnaround, the additional risk of stock price decline is limited."