Corporate Logo(source: samsungsdi.com)
Samsung Securities lowered its target price for Samsung SDI (006400) from 300,000 KRW to 270,000 KRW on April 28, citing an unavoidable downgrade in earnings due to conservative operations by EV customers under the influence of U.S. tariff policies.
Jang Jung-hoon, an analyst at Samsung Securities, attributed Samsung SDI’s first-quarter operating loss of 434.1 billion KRW—which fell short of market consensus—to lower-than-expected plant utilization rates caused by inventory adjustments from non-JV EV and power tool customers, despite steady shipments from its North American joint venture (JV). He further explained, "Due to the U.S. tariff policy, U.S.-based EV OEMs are inevitably adjusting their sales strategies."
Shipments from StarPlus Energy (SPE), the joint venture with Stellantis, were initially projected to reach around 9GWh, but are now expected to fall short of 7GWh following the adjustment of sales strategies.
Consequently, Samsung SDI’s expected annual tax credit under the Advanced Manufacturing Production Credit (AMPC) program has been revised down from 623.6 billion KRW to 468.5 billion KRW.
Jang also noted, "Although shipments of EV batteries to Europe are increasing in the second quarter, the growth will likely be smaller than initially anticipated. As a result, the mid-to-large EV battery segment is expected to remain in the red." However, he added that "the small battery segment is projected to grow by more than 30%, driven by customer promotions and increased demand for data center battery backup units (BBUs), helping to reduce overall losses."
Accordingly, Samsung Securities cut its annual operating profit forecast for Samsung SDI from 717.9 billion KRW to 433.6 billion KRW.
Despite the downgrade, Jang maintained a "Buy" rating, citing improvements in order prospects driven by the global adoption of prismatic cell form factors among major EV OEMs. "Given that Samsung SDI’s shares are currently trading at a PBR of 0.8x, the stock remains undervalued compared to its peers," he emphasized.
*[KOSPI]Samsung SDI(006400) is an affiliate of Samsung Electronics and consists of two business divisions: the Energy Solution division, which produces and sells lithium-ion secondary batteries in mid-to-large-sized or small-sized batteries, and the Electronic Materials division, which produces and sells semiconductor and display materials. The market capitalization is 12.735 trillion won(as of April 25, 2025, closing price).
Corporate Logo(source: samsungsdi.com)
Samsung Securities lowered its target price for Samsung SDI (006400) from 300,000 KRW to 270,000 KRW on April 28, citing an unavoidable downgrade in earnings due to conservative operations by EV customers under the influence of U.S. tariff policies.
Jang Jung-hoon, an analyst at Samsung Securities, attributed Samsung SDI’s first-quarter operating loss of 434.1 billion KRW—which fell short of market consensus—to lower-than-expected plant utilization rates caused by inventory adjustments from non-JV EV and power tool customers, despite steady shipments from its North American joint venture (JV). He further explained, "Due to the U.S. tariff policy, U.S.-based EV OEMs are inevitably adjusting their sales strategies."
Shipments from StarPlus Energy (SPE), the joint venture with Stellantis, were initially projected to reach around 9GWh, but are now expected to fall short of 7GWh following the adjustment of sales strategies.
Consequently, Samsung SDI’s expected annual tax credit under the Advanced Manufacturing Production Credit (AMPC) program has been revised down from 623.6 billion KRW to 468.5 billion KRW.
Jang also noted, "Although shipments of EV batteries to Europe are increasing in the second quarter, the growth will likely be smaller than initially anticipated. As a result, the mid-to-large EV battery segment is expected to remain in the red." However, he added that "the small battery segment is projected to grow by more than 30%, driven by customer promotions and increased demand for data center battery backup units (BBUs), helping to reduce overall losses."
Accordingly, Samsung Securities cut its annual operating profit forecast for Samsung SDI from 717.9 billion KRW to 433.6 billion KRW.
Despite the downgrade, Jang maintained a "Buy" rating, citing improvements in order prospects driven by the global adoption of prismatic cell form factors among major EV OEMs. "Given that Samsung SDI’s shares are currently trading at a PBR of 0.8x, the stock remains undervalued compared to its peers," he emphasized.
*[KOSPI]Samsung SDI(006400) is an affiliate of Samsung Electronics and consists of two business divisions: the Energy Solution division, which produces and sells lithium-ion secondary batteries in mid-to-large-sized or small-sized batteries, and the Electronic Materials division, which produces and sells semiconductor and display materials. The market capitalization is 12.735 trillion won(as of April 25, 2025, closing price).