[Click eStock] "Samsung SDI, Clear Signs of Earnings Improvement Confirmed"

[Asia Economy Reporter Ji Yeon-jin] KB Securities announced on the 1st that it confirmed a clear improvement in Samsung SDI's performance in the second quarter and maintained a buy rating and a target price of 830,000 KRW.

Samsung SDI recorded sales of 4.74 trillion KRW in the second quarter, a 42% increase compared to the same period last year, and operating profit of 429 billion KRW, up 45%. Sales increased by 30% compared to the previous quarter due to expanded shipments of electric vehicle batteries and the added effect of exchange rates. It is analyzed that the strong shipment of Gen 5 batteries significantly contributed to driving up sales.

Energy Storage System (ESS) battery sales increased by 30% quarter-on-quarter as sales related to power projects in the Americas expanded. The proportion of high-value-added home-use/UPS products also remained high, improving profitability. Although pouch batteries in small cells underperformed due to a slowdown in IT demand, sales grew by double digits quarter-on-quarter thanks to strong electric vehicle battery sales. Electronic materials showed favorable performance in OLED and semiconductor materials, but sales decreased by 8% quarter-on-quarter due to a decline in polarizing film shipments caused by weakening LCD TV demand. However, profitability reached an all-time high (operating margin of 27.5%) due to one-time gains.

Samsung SDI's third-quarter 2022 performance is expected to show sales of 5.28 trillion KRW, a 54% increase year-on-year, and operating profit of 475.4 billion KRW, up 27%. KB Securities analyst Lee Chang-min said, "Although electronic materials are expected to show negative growth quarter-on-quarter due to weak LCD TV demand, the expansion of prismatic and cylindrical EV battery demand is expected to drive overall performance improvement." He added, "In particular, the high-value-added Gen 5 batteries, which continue to show strong sales, are expected to expand their share within prismatic batteries to 25% in the second half as sales channels expand to new customers."

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