IBK Securities projected on the 13th that LOTTE Energy Materials is expected to see an increase in utilization rates in the second quarter (April to June), but cautioned that it should be mindful of speed adjustments based on forward demand. It also lowered its target price from 60,000 won to 24,000 won. The previous day, LOTTE Energy Materials' closing price was 22,300 won.
Lee Hyun-wook, a researcher at IBK Securities, noted, "With uncertainty surrounding sales increases for key customers Ultium and SDI within the year, the impact of U.S. tariffs and the rising market share of Chinese battery corporations in Europe are expected to worsen market conditions."
He added, "LOTTE Energy Materials' utilization rate is currently expected to adjust based on forward demand, staying in the 40% range," and presented an operating loss estimate of 22 billion won for the second quarter.
However, it was assessed that a significant increase in utilization rates is expected to begin in the second quarter of this year. The researcher estimated that meaningful recovery in utilization rates for the second quarter is anticipated through the depletion of excess inventory that began in the third quarter (July to September) of last year, estimating the utilization rate at 56% for the second quarter.
Additionally, he added, "While fixed costs are expected to decrease, improving profitability, a return to profit on a quarterly basis will only be possible from the fourth quarter (October to December) of this year."
LOTTE Energy Materials reported on the 9th that it recorded sales of 158 billion won and an operating loss of 46 billion won in the first quarter of this year. Sales decreased by 34.6% compared to the same period last year, and unlike the operating profit of 4.3 billion won recorded in the first quarter of last year, it turned to a deficit.