[Click eStock] "LG Chem, Slight Increase in Q2 Operating Profit"

[Asia Economy Reporter Hwang Yoon-joo] Kiwoom Securities stated on the 5th that LG Chem's operating profit for the second quarter is expected to slightly exceed market expectations. The investment opinion was maintained as 'Buy' with a target price of 750,000 KRW.

Researcher Lee Dong-wook of Kiwoom Securities predicted, "LG Chem's operating profit for the second quarter of this year is expected to be 901.1 billion KRW, slightly exceeding the market expectation of 895.9 billion KRW."

The petrochemical division's operating profit is expected to decrease by 16.3% compared to the previous quarter to 531.5 billion KRW. Researcher Lee explained, "The NCC division's operating rate was reduced due to deteriorating economics, and the sharp rise in butadiene prices is expected to reduce the profitability of rubber/ABS."

The advanced materials division's operating profit is expected to increase by 30.3% compared to the previous quarter to 200.6 billion KRW, thanks to improved profitability across all product lines. Researcher Lee analyzed, "In particular, battery materials are expected to see a significant increase in scale compared to the previous quarter due to expanded sales of high-nickel product lines, rising cathode material prices, and the effects of capacity expansion."

The energy solutions division's operating profit is expected to decrease by 22.4% compared to the previous quarter to 200.8 billion KRW. Researcher Lee attributed this to production disruptions at Chinese cylindrical battery customers, adding, "However, it is estimated that performance improved gradually in May and June due to improved operating rates of Chinese and European OEM companies."

Researcher Lee stated, "Not only battery materials but also OLED, semiconductor, and engineering materials within the advanced materials division are expanding investments and product lineups," adding, "They are expanding mass production product lineups such as small and medium-sized OLED blue and less host."

Meanwhile, LG Chem's battery materials division sales for the second quarter are expected to exceed 1.1001 trillion KRW, an increase of more than 63% compared to the previous quarter. This is because the rise in cathode material prices and the effects of capacity expansion are expected to be reflected in the second quarter.

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