LG Chem Hits 1 Million... Can It Surpass 1.25 Million Riding the Blue Wave?

[Asia Economy Reporter Park Jihwan] LG Chem, which has reached a new all-time high since its listing, has succeeded in reaching the dream milestone of 1 million KRW, benefiting from the rapid growth of the global electric vehicle market and the strong performance of chemical products. The securities industry has even mentioned a target price of 1.25 million KRW. The 'Blue Wave,' where the US Democratic Party controls the White House, the House of Representatives, and now the Senate, has become a reality, leading to an unstoppable upward trend.

On the 8th, LG Chem, the leader in secondary batteries, succeeded in surpassing 1 million KRW. On that day, LG Chem recorded 1,016,000 KRW, up 5.61% from the previous trading day, exceeding the highest target price of 1 million KRW set by the securities industry last year. The previous day, the stock price rose to 969,000 KRW during trading hours, setting a new all-time high since its listing in 2001, and broke the previous high again just one day later. Since March 19, when the stock price fell to 230,000 KRW due to the impact of the novel coronavirus disease (COVID-19), it has risen more than 300% in 10 months.

The strong stock price is attributed to expectations that the Biden administration's eco-friendly policies will gain more momentum following the US Blue Wave, making the growth of the electric vehicle market even more prominent. It is expected that as the global electric vehicle market grows, the sales volume of domestic battery companies will also increase. LG Chem has agreed to supply all the batteries used in Tesla Model Y vehicles produced in China starting this year. The Model Y has been performing well, surpassing 10,000 new car sales in October last year.

In addition to the favorable battery market, the securities industry sees ample room for further growth due to LG Chem's relatively low market capitalization compared to competitors and rising prices of its main chemical products. Compared to the market capitalization of China's CATL (150 trillion KRW), which competes for the top spot among global battery companies, LG Chem (68 trillion KRW) is considered significantly undervalued.

The increased demand for the main product, synthetic resin ABS, is also a positive factor. ABS is used for automotive interior materials and mobile phone exteriors, and global demand has surged significantly since COVID-19. Won Minseok, a researcher at Hi Investment & Securities, said, "Considering that various countries' stimulus measures will continue this year, steady demand for chemical materials including ABS is expected."

Some in the securities industry also mention the possibility of LG Chem's stock price reaching 1.25 million KRW. Samsung Securities recently set a target price of 1.25 million KRW, and Daishin Securities set a target price of 1.2 million KRW.

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