[Special Stock] Ecopro Holds 3.3 Trillion KRW in Affiliate Shares... Expectation for HN Share Swap

[Asia Economy Reporter Hyungsoo Park] Ecopro's stock price has reversed to an upward trend.

At 11:41 a.m. on the 10th, Ecopro was trading at 97,100 KRW, up 2.64% from the previous day. After rising to the daily price limit the day before, selling pressure for profit-taking emerged early in the session, causing the price to drop to 90,200 KRW. Since then, buying demand flowed in, leading to a rebound.

Considering only the value of the 51.4% stake held by Ecopro, it amounts to about 3.4 trillion KRW, exceeding the current Ecopro market capitalization of 1.8 trillion KRW.

Jang Jung-hoon, a researcher at Samsung Securities, explained, "We believe the valuation of the holding company is more conservative than before," adding, "We are increasing the discount rate from the previous 30% to 50%."

He continued, "If the earnings contributions from affiliates other than Ecopro BM become full-fledged, Ecopro is expected to have additional momentum."

Kim Kwang-jin, a researcher at Yuanta Securities, analyzed, "Ecopro's stock price has only reflected the value of Ecopro BM's stake," adding, "As vertical integration is emphasized due to the competitiveness of material companies, it is necessary to reflect the appropriate value of major subsidiaries in the stock price."

He emphasized, "All three subsidiaries play a key role in the anode material value chain and plan to expand their roles within the group through additional capacity expansion."

He analyzed, "All three companies plan to more than double their production capacity compared to the current level by the end of next year," adding, "By next year, the combined business value of the three companies will exceed 3 trillion KRW."

Furthermore, he explained, "The share swap for the consolidation of Ecopro HN as a subsidiary is expected to take place no later than September to October, following the listing of new shares from Ecopro HN's free capital increase," adding, "This is due to the necessary time required for procedures such as the stock purchase request period."

He advised, "After the share swap, the effect of consolidating Ecopro HN as a subsidiary and the value of other subsidiaries are expected to be quickly reflected in the stock price," adding, "Since the share swap timing is imminent, it is necessary to actively buy from now."

The fair value of Ecopro estimated by researcher Kim is 2.8 trillion KRW, which is about 1 trillion KRW higher than Ecopro's current market capitalization of 1.8 trillion KRW.

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