Brokerage : iM Securities
Analyst : Won-seok Jung, Jung-ha Park
Investment Rating : Buy (Maintained)
Target Price : KRW 590,000 (Lowered)
Core Momentum : Accelerating a structural business transition toward ESS to capture North American AI data center power demand, enhancing medium- to long-term earnings visibility via US capacity expansions and AMPC tax credits.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: Buy (Maintained), Target Price KRW 590,000 (Lowered to reflect valuation multiple contractions across the global secondary battery sector)
- Valuation Methodology: Sum-of-the-parts (SOTP) combining operating value (applying 8.2x EV/EBITDA, the 2028F global peer average) and Samsung Display equity stake value
- Market Data (As of 2026-07-30): Close KRW 358,500 (Upside 64.6%), Market Cap KRW 28.89 Trillion, Shares Outstanding 80.59 Million, Foreign Ownership 26.4%
- Key Financial Forecasts (2025 → 2026F → 2027F):
- Revenue: KRW 13.27 Trillion → KRW 16.24 Trillion → KRW 22.02 Trillion
- Operating Profit: KRW -1.998 Trillion → KRW 396.0 Billion (Turnaround) → KRW 1.76 Trillion
- Net Profit: KRW -649.0 Billion → KRW 751.0 Billion (Turnaround) → KRW 1.51 Trillion
- EPS: KRW -8,325 → KRW 9,134 → KRW 18,399
- BPS: KRW 260,851 → KRW 279,173 → KRW 306,781
- ROE: -3.2% → 3.4% → 6.3%
- PER / PBR: -x / 1.0x → 39.2x / 1.3x → 19.5x / 1.2x
- EV/EBITDA: 293.8x → 12.9x → 8.7x
🚀 2. [Market Opportunities & Business Outlook]
- 2Q26 Earnings Review: Revenue reached KRW 3.8 Trillion (YoY +19%, QoQ +5%) and Operating Profit stood at KRW 204.0 Billion (Turnaround QoQ/YoY), significantly beating consensus estimates (Revenue KRW 3.7 Trillion, Operating Profit KRW -27.3 Billion). Underlying operational profit turned positive even after stripping out ~KRW 190.0 Billion in one-off tariff refunds. Automotive battery losses narrowed on alternative European supply from the US SPE plant, while small battery sales expanded (+10% QoQ) led by strong AI Data Center (AIDC) BBU demand.
- 3Q26 Earnings Outlook: Projected Revenue of KRW 4.1 Trillion (YoY +34%, QoQ +8%) and Operating Profit of KRW 110.0 Billion (Turnaround YoY, QoQ -46%). While headline operating profit will decrease due to the base effect of the 2Q tariff refund, underlying core operating profit is set to improve continuously. ESS sales are expected to increase +35% QoQ as shipments for deferred domestic utility projects begin in earnest.
- Medium- to Long-Term Growth Drivers:
- ESS Pivot: Commercial ramp-up of the US LFP line in 4Q26 will drive top-line expansion, fixed-cost dilution, and increased AMPC benefits. Potential allocation of the GM JV line (planned for 2028 operation) toward ESS production provides additional upside.
- Small Batteries & Electronic Materials: Cylindrical batteries are projected to turn profitable in 3Q26 with a +9% QoQ revenue increase on AIDC BBU demand. Electronic materials will benefit from semiconductor recovery, peak seasonality, and new OLED material shipments.
📝 Editor’s Comment (Perspective)
The analyst views Samsung SDI not merely as a conventional EV battery supplier wrestling with OEM client volume adjustments, but as a repositioning energy solutions provider actively pivoting its capacity toward the rapidly growing ESS market driven by North American AIDC power demand. This perspective places primary importance on the qualitative restructuring of the product mix toward US-based ESS and tangible policy benefits (AMPC), rather than near-term cyclical fluctuations in pure-play EV automotive demand.
To verify the ongoing validity of this investment thesis, key monitoring factors include the successful commercial ramp-up and yield stabilization of the US ESS LFP line in 4Q26, sequential revenue recognition from delayed domestic/global ESS projects, and concrete execution regarding the potential conversion of the 2028 GM JV lines into dedicated ESS capacity. These structural developments can be tracked through future quarterly earnings announcements, official company IR presentations, and statutory filings.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
Contact: Compliance and Copyright Inquiries (ksb220805@gmail.com)
