Equity Analysis /
South Korea

KR : Samsung SDI - Capacity expansion on strong earnings

    John Park
    CGS-CIMB
    30 March 2022
    Published by

    SDI’s share price is likely to bottom out given positive expectations for 1Q22F/2022F earnings and relaxation of EV supply/geopolitical risks. We see SDI’s valuation gap with LGES narrowing on SDI’s battery capacity expansion (23GWh+ for Stellantis) in 2Q22F (42GWh capacity as at 4Q21). Reiterate our Add call and SOP-based TP of W750k. SDI’s battery unit is trading at W28tr on 11x FY23F EV/EBITDA (24x LGES, 26x CATL).