LG Energy Solution Predicts Record-Breaking Success... Intensified Short Selling of LG Chem

[Asia Economy Reporter Ji Yeon-jin] As the listing of LG Energy Solution, one of the world's largest electric vehicle battery manufacturers, approaches, short-selling attacks on LG Chem are also intensifying.

According to the Korea Exchange on the 15th, as of the 13th, the short-selling transaction amount for LG Chem was 70.3 billion KRW, the highest in the KOSPI market. This is more than double the second-ranked Naver's short-selling transaction amount of 29.3 billion KRW. On the previous day, 11% of the total short-selling transaction amount (620.4 billion KRW) was concentrated on LG Chem.

LG Chem has been the most short-sold stock in the KOSPI market for six consecutive trading days since the 6th. On the 7th, short-selling worth approximately 232.6 billion KRW took place in a single day, accounting for 32% of the total short-selling in KOSPI. The short-selling balance of LG Chem surged by more than 100 billion KRW from 159 billion KRW at the end of last year to 259.5 billion KRW as of the 11th.

It is interpreted that investors are betting on the decline of the parent company's stock price as LG Energy Solution, which was spun off from LG Chem's electric vehicle battery division, is scheduled to be listed at the end of this month.

LG Chem was considered a "king stock" as its price soared to 1.05 million KRW in January last year, but its stock price declined as the domestic stock market experienced adjustments due to concerns over inflation and interest rate hikes. Furthermore, after the announcement of LG Energy Solution's listing schedule, the stock price plunged further, hitting an intraday low of 611,000 KRW on December 30 last year, marking a 52-week low.

However, on the same day, Financial Services Commission Chairman Ko Seung-beom stated, "The issue of physical spin-offs has recently become a major focus," and added, "We will review it from various perspectives, including legal aspects," which led to a rebound. Starting with gains on the first trading day of this year, LG Chem recorded five consecutive days of increases and recovered to the 770,000 KRW range on the 12th.

During this period, short-selling was concentrated on LG Chem, but with the government and presidential candidates from both ruling and opposition parties proposing pledges to regulate listings after physical spin-offs, the stock price appeared to rise instead.

However, after the institutional demand forecast for LG Energy Solution, which closed on the 12th, attracted astronomical funds and predicted a record-breaking success, LG Chem's stock price declined again. Samsung Securities researcher Cho Hyun-ryeol said, "From an investment perspective related to the listing of a high-growth subsidiary, substitutes appear, negatively affecting investor sentiment," and added, "Considering the uncertainty investors have regarding supply and demand before and after the IPO, short-term weak investor sentiment is inevitable."

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