Samsung SDI's medium and large-sized battery business is expected to improve as the electric vehicle market is showing rapid growth. It was estimated that Samsung SDI would see better-than-expected results in the second quarter.
Under such prediction, Jeong Won-seok, a researcher at Hi Investment & Securities Co., raised the target stock price of Samsung SDI to 490,000 won from the existing 350,000 won and kept the investment opinion "BUY" on July 8. Shares of Samsung SDI closed at 391,000 won the previous day.
Samsung SDI is planning to release Gen5 batteries in the second half of next year. The Gen5 battery is equipped with a 'high-nickel' NCA (nickel, cobalt and aluminum) anode material with a high proportion of nickel to improve energy density.
Another change is the application of the production process of internal materials (anode material, electrolyte, separator, cathode material) of batteries to the stacking method, which is a form of piling up from the traditional winding method.
Until now, Samsung SDI has been using a winding method for both small and medium batteries. Although its production efficiency is high due to its easy assembly process, it is difficult to utilize 100% of the corner space inside the battery in each type. As such, Samsung SDI is planning to maximize its energy density through a stacking method.
"The slump was less than expected in all business sectors," Jeong said. "The small battery sector, which was affected by COVID-19 in the first quarter, is showing a gradual recovery from the worst situation."
He added, "In the second half of the year, there will be a clear improvement in Samsung SDI's profits due to increased sales, eased fixed costs, and increased performance in the electronic materials sector due to the entry into the seasonal peak season."
