NH Investment & Securities projected that ECOPRO BM's revenue for the last quarter would be poor. They lowered the target price from the previous 176,000 won to 150,000 won. However, they suggested a 'buy' investment opinion. On the 7th, ECOPRO BM's closing price was 116,000 won.
On the 8th, Jumin Woo, a researcher at NH Investment & Securities, said, 'ECOPRO BM's revenue for the fourth quarter of last year is expected to be 452.9 billion won, with an operating loss of 24.9 billion won,' and noted, 'this will fall short of the consensus market expectations of 530.6 billion won in revenue and 12.2 billion won in operating loss.'
NH Investment & Securities is taking a conservative view of ECOPRO BM's performance because a scheduled inventory adjustment is underway among its customers, leading to sluggish sales of cathode materials. The lead researcher estimated that ECOPRO BM's selling price decreased by 8% and sales volume by 9%.
He explained, 'Even with one-time expenses reflected at the end of the year, the reversal of inventory valuation losses is expected to be reflected at around 10 billion won, and the operating profit margin is projected to improve to minus (-) 5.5% compared to the previous quarter,' adding, 'shipments to energy storage systems (ESS) are increasing, and the proportion of ESS in total sales will stabilize at around 40%.'
The outlook for future sales growth is also not bright. There are signs that electric vehicle policies centered on the United States, the United Kingdom, and Europe are changing unfavorably compared to the past.
The lead researcher noted, 'The key to performance recovery is the recovery of sales to Samsung SDI in Europe and sales recovery to SK On for Ford in the United States,' and added, 'Both Europe and the United States need to adjust expectations for short-term growth rates due to changes in electric vehicle policy stances.'
However, he concluded, 'Even if the speed of transition to electric vehicles slows, ECOPRO BM's efforts to strengthen its foundations are proceeding well.' ECOPRO BM plans to secure a cost competitiveness level that can compete with Chinese high-nickel cathode manufacturers through vertical integration established locally in Indonesia by 2026.
Additionally, the plan is to secure new major customers, including Samsung SDI and SK On, targeting commercial production by 2027 to diversify revenue sources. The lead researcher added, 'Gradual recovery in sales volume remains valid.'