[Click eStock] "Korean Battery, Mid- to Long-Term Investment Recommended for Stocks with Low Valuation"

On the 18th, Eugene Investment & Securities stated, "Although domestic battery companies have secured a leading position in the U.S. market, their growth potential in Europe and emerging markets has diminished," adding, "Since the stock price decline has been significant, it is advisable to make mid- to long-term investments focusing on stocks with low valuations (price-to-earnings ratio)."

On the same day, researcher Han Byunghwa of Eugene Investment & Securities said, "We need to consider the recent slowdown in the global electric vehicle market expansion."

He explained, "Korean battery companies have secured a mid- to long-term growth foundation by leading the U.S. electric vehicle market, but their market share in Europe, which was previously the largest market, continues to decline," adding, "In emerging markets, they are also being outpaced by Chinese companies." Europe is preparing to impose additional tariffs on Chinese-made electric vehicles, but regulations on batteries remain limited. This is because the dependency is too high, and imposing trade barriers would lead to higher electric vehicle prices, reducing demand.

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He also noted, "Some domestic battery material and component companies are receiving excessively high valuations compared to overseas companies," while "overseas, negative risks from oversupply originating in China are being reflected in the stock prices of related companies."

Meanwhile, the world's number one electric vehicle company Tesla's Model 2 is expected to experience slower sales growth than anticipated due to competition with Chinese companies. The researcher pointed out, "Tesla's unstoppable progress was based on the economies of scale enjoyed by the global number one company and the manufacturing capabilities to realize it," adding, "although the Shanghai factory has been used as a base to export not only to the local Chinese market but globally, concerns are growing that the Shanghai plant may have reached its growth limit."

He stated, "Competition among local Chinese electric vehicle companies is intensifying, and trade barriers against Chinese-made electric vehicles in Europe and the U.S. are increasingly restricting exports," adding, "For example, Model 2 needs to establish a mass production system at a low price in the $20,000 range, but in China, electric vehicles priced between $10,000 and $20,000 have already secured the market." Tesla has ultimately decided to initiate early production of Model 2 at its Texas factory. As a result, manufacturing costs are expected to rise compared to the original plan, and expectations for Model 2 may be somewhat reduced."

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