[Click eStock] "CIS, Key Equipment Company for Secondary Battery Investment"

[Asia Economy Reporter Ji Yeon-jin] SK Securities announced on the 16th that CIS is expected to benefit as a core equipment company with material technology in the upcoming secondary battery investment cycle.

CIS is a secondary battery electrode process equipment company, mainly producing coater, calender, and slitter equipment. As of last year, the sales revenue composition was 69.0% from calender, 17.4% from slitter, 6.3% from coater, and 7.3% from others.

The major clients are LGES, Samsung SDI, and Northvolt, and the combined production capacity of the first and second plants is at a level capable of achieving sales revenue of 250 billion KRW.

The electrode process accounts for about 36% of the investment in medium-to-large secondary battery equipment, and especially CIS’s equipment such as coater, calender, laminator, and slitter is estimated to account for about 31%. CIS holds a high market share among major clients LGES, Samsung SDI, and Northvolt, and continues to receive steady new orders. Since 2018, the proportion of Chinese companies has decreased, and the share of Northvolt has increased, leading to a turnaround to operating profit in the first half of 2019 and subsequent growth. This year’s first half achieved sales revenue of 73.2 billion KRW and operating profit of 10.7 billion KRW (profit margin 14.6%).

Researcher Park Chan-sol of SK Securities said, "Electric vehicle manufacturers’ production targets are concentrated in 2025, and the initial volume production period of European cell manufacturers is concentrated between 2023 and 2025," adding, "Domestic cell manufacturers (including global joint ventures) are also expected to focus investments between 2022 and 2024 because global electric vehicle companies have set specific targets such as production volume and the number of electric vehicle models by 2025. Therefore, due to the nature of equipment order contracts, orders are expected to start increasing from the fourth quarter of this year and the first quarter of next year."

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