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MarketScreener Homepage  >  Equities  >  Korea Stock Exchange  >  LG Chem, Ltd.    A051910   KR7051910008

LG CHEM, LTD.

(A051910)
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Tesla battery supplier LG Chem shares jump 10% on upbeat outlook

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07/31/2020 | 02:22am EDT
FILE PHOTO: Tesla Inc CEO Elon Musk dances onstage during a delivery event for Tesla China-made Model 3 cars in Shanghai

LG Chem, an electric vehicle battery supplier for Tesla, Volkswagen and others, said on Friday it expects profitability in its battery business to rise in the second half, helping shares surge nearly 10%.

"Sales are expected to grow and profitability is expected to remain robust thanks to greater EV shipments for European automakers and increased sales for cylindrical EV batteries," LG Chem said.

The company did not mention Tesla, but it supplies small cylindrical-type batteries for the carmaker's China models.

LG Chem's energy solutions division, which makes batteries for smartphones and cars, swung to an operating profit in the second quarter, partly due to improved productivity at its Poland factory which caters to European customers like Volkswagen and Audi.

LG Chem said its factory utilization rates have normalized starting May after the coronavirus outbreak had led to temporary factory suspensions at automakers in the U.S. and Europe.

Tesla CEO Elon Musk has said the company would expand its business with Panasonic, CATL and LG Chem, adding that the real limitation to it's growth is battery cell production at an affordable price.

Musk said Tesla's Shanghai factories will produce some Model 3 sedans with the so-called lithium-iron-phosphate (LFP) batteries in volume starting later this year.

LG Chem said its batteries have an edge over the cheaper, LFP batteries from Chinese rival and Tesla supplier CATL, saying the latter's lower energy density makes it difficult to be used for longer-range, large cars.

"The LFP batteries can be used in relatively short-range cars which are sensitive to prices... We believe that our nickel-cobalt-manganese (NCM) batteries can be mainstream globally," said Chang Seung-se, senior vice president at LG Chem, referring to its nickel-based batteries.

LG Chem, however, said it is trying to "catch up" with LFP batteries in terms of cost competitiveness.

(Reporting by Hyunjoo Jin and Heekyong Yang; Additional reporting by Joyce Lee; Editing by Stephen Coates and Krishna Chandra Eluri)

Stocks mentioned in the article
ChangeLast1st jan.
AUDI AG 0.00% 1570 Delayed Quote.96.25%
CONTEMPORARY AMPEREX TECHNOLOGY CO., LIMITED 3.32% 212.17 End-of-day quote.99.41%
LG CHEM, LTD. 7.17% 568000 End-of-day quote.78.90%
LG CORP. 0.82% 74000 End-of-day quote.0.27%
PANASONIC CORPORATION 0.00% 900 End-of-day quote.-12.58%
TESLA, INC. -3.81% 1430.76 Delayed Quote.242.02%
VOLKSWAGEN AG 1.62% 126.56 Delayed Quote.-29.07%
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Financials
Sales 2020 31 121 B 26,1 B 26,1 B
Net income 2020 1 183 B 0,99 B 0,99 B
Net Debt 2020 8 700 B 7,30 B 7,30 B
P/E ratio 2020 35,4x
Yield 2020 0,54%
Capitalization 41 199 B 34 537 M 34 566 M
EV / Sales 2020 1 324x
EV / Sales 2021 1 078x
Nbr of Employees -
Free-Float 58,0%
Chart LG CHEM, LTD.
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Technical analysis trends LG CHEM, LTD.
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 30
Average target price 598 233,33 KRW
Last Close Price 568 000,00 KRW
Spread / Highest target 40,8%
Spread / Average Target 5,32%
Spread / Lowest Target -51,6%
EPS Revisions
Managers
NameTitle
Hak Cheol Shin Vice Chairman & Chief Executive Officer
Okdong Son President
Jin-Soo Park Vice Chairman
Dong-Seok Cha Chief Financial Officer & Director
Ki-Soo No CTO & President-Executive Board
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