[Click eStock] "Samsung SDI, Strong First Half Performance... Entering Phase of Increased Volume in Second Half"

[Asia Economy Reporter Hwang Yoon-joo] NH Investment & Securities maintained its investment opinion of 'Buy' and target price of 1,000,000 KRW for Samsung SDI on the 24th, stating that in the first half of the year, an increase in volume from existing customers is expected, and in the second half, volume growth is anticipated due to the new operation of the Hungary Plant 2.

Joo Min-woo, a researcher at NH Investment & Securities, stated, "Sales in the first quarter of 2022 are expected to be 3.8 trillion KRW (+30% y-y, +1% q-q), and operating profit is expected to be 300 billion KRW (+125% y-y, +13% q-q), exceeding consensus estimates by 2% and 4%, respectively, indicating solid performance."

Researcher Joo analyzed, "Despite production disruptions at electric vehicle battery customers and raw material price pressures, shipments of Gen5 batteries to BMW remain robust, overcoming these challenges," and "Profitability is expected to show a low single-digit operating profit."

[Image source=Yonhap News]

Researcher Joo stated, "Sales in the second quarter are expected to be 4.3 trillion KRW (+28% y-y, +11% q-q), and operating profit is expected to be 367.1 billion KRW (+24% y-y, +22% q-q), exceeding consensus by 7% and 2%, respectively, due to increased shipments of Gen5 to BMW and a recovery in ESS shipments."

He added, "In the second half, with the operation of Hungary Plant 2 and additional supply of Gen5 to Audi, Samsung SDI will enter a phase of significant volume growth," and "Although utility and logistics costs at European plants pose a burden on profitability, the increase in the proportion of Gen4 and Gen5 batteries to over 50% will improve the product mix and offset these costs."

He continued, "If these costs stabilize downward, further profitability improvements are possible, and in the mid to long term, new customers beyond Stellantis will be secured to increase orders for high-nickel based Gen5 and Gen6 batteries."

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