Bluewave Ignites Secondary Battery Stocks... LG Chem Surpasses 1 Million Won

LG Chem Surpasses Previous High Again in One Day
Brokerage Firms Mention Target Price of 1.25 Million KRW
Samsung SDI and SK Innovation Also Continuously Hit Post-Listing Record Highs

[Asia Economy Reporters Song Hwajeong and Park Jihwan] As the US Democratic Party realizes the 'Blue Wave' by taking control of the White House, the House of Representatives, and now the Senate, secondary battery stocks have been showing unstoppable upward momentum since the beginning of the year.

On the 8th, LG Chem, the leading secondary battery stock, succeeded in surpassing the dream mark of 1 million KRW in the early trading session. At 9:50 AM, LG Chem recorded 1,008,000 KRW, up 46,000 KRW (4.78%) from the previous day, exceeding last year's highest target price of 1 million KRW set by securities firms. The day before, it rose to 969,000 KRW during trading, marking the highest price since its listing in 2001, and broke that record again just one day later. Samsung SDI also rose 2.15%, reaching 718,000 KRW during trading and setting a new high for the second consecutive day. SK Innovation showed a 6.27% increase, continuing its seven-day consecutive rise. It also reached a new high of 282,500 KRW during trading.

These three secondary battery leaders have contributed to breaking through the KOSPI 3000 mark with their sharp rises since the beginning of the year. LG Chem has risen 16.75% so far this year, Samsung SDI 11.15%, and SK Innovation 38.42%, respectively.

The global electric vehicle market growth expectations following the realization of the US Blue Wave are interpreted as driving the rise in secondary battery stocks. The Democratic Party secured both seats in the Georgia federal Senate runoff election, realizing the Blue Wave by taking control of the Senate following the House. With the Blue Wave realized, it is expected that the eco-friendly investments emphasized by President-elect Joe Biden will be fully activated.

LG Chem has agreed to supply all batteries for Tesla Model Y vehicles produced in China starting this year. The Model Y has been cruising smoothly, surpassing 10,000 new car sales in October last year. The securities industry sees ample room for further price increases due to not only the favorable electric vehicle battery market but also LG Chem’s relatively low market capitalization compared to competitors and rising prices of its main chemical products. Compared to China's CATL, which competes for the top global battery company position with a market cap of 150 trillion KRW, LG Chem’s market cap (68 trillion KRW) is considered significantly undervalued. Some securities firms even suggest LG Chem’s stock price could reach 1.25 million KRW. Samsung Securities recently set a target price of 1.25 million KRW, and Daishin Securities set a target of 1.2 million KRW.

Target prices for Samsung SDI and SK Innovation have also been revised upward. Hanwha Investment & Securities raised Samsung SDI’s target price from 560,000 KRW to 860,000 KRW, and NH Investment & Securities raised SK Innovation’s target price from 110,000 KRW to 330,000 KRW.

Kim Hyunsoo, a researcher at Hana Financial Investment, said, "Last year, the combined market share of the three Korean secondary battery companies was 34%, accounting for one-third of the global market, entering a phase of significant profitability improvement. We believe the current high multiple trend can be maintained for the time being, and considering the still low margin outlook for the medium-to-large battery sector and conservative energy storage system (ESS) market forecasts, there is sufficient room for further upward revisions of earnings estimates."

This content was produced with the assistance of AI translation services.