[Click eStock] "L&F, Tesla Supply Confirmed... Target Price Up"

Daol Investment & Securities on the 2nd significantly raised the target price for L&F from 300,000 KRW to 380,000 KRW and designated it as the top pick within the related industry.

L&F announced on the 28th of last month that it had signed a supply contract for high-nickel cathode materials with Tesla. It plans to supply high-nickel materials worth a total of 2.9 billion USD (3.8 trillion KRW) over two years from 2024 to 2025.

This supply contract corresponds to a volume sufficient for a total of 550,000 units based on the Tesla Model Y. Tesla is expected to use in-house batteries for approximately 700,000 units annually.

Additionally, Tesla previously announced plans to expand battery production capacity (CAPA) at its Texas Gigafactory and to expand related factories at the Nevada Gigafactory. The required cathode material is estimated to be about 140,000 tons, raising expectations for additional supply contracts from L&F in the future.

Jeon Hye-young, a researcher at Daol Investment & Securities, said, "By securing supply to Tesla, L&F has proven its attempt to diversify its customer base," adding, "It has been confirmed that they are currently pursuing the issuance of exchangeable bonds (EB), which is judged to be resolving funding risks for capacity expansion."

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