The target price of Solus Advanced Materials, a battery material company, has increased.
It is expected that Solus Advanced Materials will be able to increase mid- to long-term growth potential in the battery gourd business by expanding factories in North America.
Kiwoom Securities raised its target price of solution advanced materials from 80,000 won to 120,000 won on the 15th. The investment opinion remained 'buy'.
"Although the timing of the operating profit surplus of the Solus high-tech battery business division may be delayed than expected, its mid- to long-term growth is expected to increase further," Kiwoom Securities said. "There are many mid- to long-term positive factors such as the expansion of the battery plant in North America as well as the expansion of the battery plant in Hungary.".
Solus Advanced Materials is a company that produces copper foil and advanced materials, and is currently the only company in Europe that has battery box production facilities.
Currently, the company is expanding its investment in the battery park business, and it is expected to finalize its plan to expand its battery copper foils plant in North America within November following the start of the expansion of Hungary plant.
If Solus Advanced Materials expands its North American plant, it can produce an additional 40,000 to 60,000 tons of battery copper foils annually.
As a result, the production of battery copper foils that Solution Advanced Materials will build by 2026 is expected to reach 100,000 tons per year. Compared to this year's annual production of 12,000 tons, it is about nine times higher in five years.
The fact that Solus Advanced Materials recently signed a battery copper foils supply contract with a global automaker is also expected to increase the mid- to long-term growth of the battery gourd business.
Solus Advanced Materials is expected to post an operating profit surplus in the battery copper foils business from the second quarter of 2022. It is delayed by about half a year from the expected time.
Solus Advanced Materials are expected to generate 1.766 trillion won in sales and 22.2 billion won in operating profit on a consolidated basis in the fourth quarter of 2021. Compared to the fourth quarter of 2020, sales increased 53.47% and operating profit decreased 14.28%.
Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com
