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LG Energy Solution (Photo=Yonhap News) |
[Alpha Biz= Reporter Kim Minyoung] Regarding LG Energy Solutions, securities firms said, "Although first-quarter operating performance was sluggish as expected, profitability will recover from the second half of this year."
LG Energy Solution (Photo=Yonhap News)
Regarding LG Energy Solutions, securities firms said on the 8th that its first-quarter operating performance was sluggish as expected, but its profitability will recover from the second half of this year. If the selling price of electric vehicles goes down, major customers are expected to stock up.
"Small batteries grew about 15% compared to the previous quarter due to increased demand for inventory by major customers (Tesla) even though the average selling price (ASP) of cylindrical batteries dropped sharply," said Yuanta Securities Co. "The demand for car batteries decreased in North America amid the continued low operation rate of the Polish plant."
LG Energy Solutions said earlier on the 5th that its first-quarter sales fell 30 percent on-year to KRW 6.1 trillion. Operating profit fell 75% over the same period to 157.3 billion won. Excluding the Production Tax Credit (AMPC) of 188.9 billion won, which subsidizes batteries produced in the U.S., the company actually lost 31.6 billion won in operating losses.
"The energy storage (ESS) sector appears to have recorded an operating profit of 2.1 billion won due to off-season and lack of clear orders due to seasonal demand," Meritz Securities said. "However, IT and other sectors are expected to suffer an operating loss of 1.1 billion won due to sluggish sales of Apple, a major customer of LG Energy Solutions."
Stock markets forecast that major customers will start stockpiling in earnest from the second quarter of this year. Although profitability of LG Energy Solutions will not recover from this quarter, it is predicted that external growth will be noticeable in the second half of this year.
Alphabiz Kim Minyoung (kimmy@alphabiz.co.kr)
