Secondary Battery Stocks Poised for Surge in Orders in Second Half... Stock Rebound Expected

NH Investment & Securities has forecast that as orders become concentrated in the second half of the year, earnings estimates across the secondary battery sector will be revised upward and stock prices will rebound. The firm also named LG Energy Solution and Daejoo Electronic Materials as its top picks.

Minwoo Joo, a researcher at NH Investment & Securities, stated, "New orders for electric vehicles (EV) and energy storage systems (ESS), centered on LG Energy Solution and Samsung SDI, are expected to materialize intensively in the second half of the year." He explained, "This will lead to upward revisions of earnings estimates across the sector and a rebound in stock prices."

The commonality among companies that saw high share price increases in the first half of the year (Samsung SDI, L&F, Daejoo Electronic Materials) is that their earnings forecasts were revised upward. It is expected that LG Energy Solution will lead the upward revision of forecasts in the second half. Joo predicted, "Based on cumulative figures for 2026, new ESS orders are estimated to be in the early 10 gigawatt-hour (GWh) range (with a target of 90 GWh), and a large number of orders are expected in the second half of the year." He analyzed, "This is because Ultium Cells (the GM joint venture plant), which has been shut down, is scheduled to resume operations at the end of the third quarter after client inventory adjustments, and Tesla's strong sales in Europe and Asia are expected to accelerate further in the second half as more countries approve Full Self-Driving (FSD)."

Tesla has obtained approval to expand battery production capacity at Giga Berlin from 8 GWh to 18 GWh. Joo said, "This is a measure to respond to strong sales in Europe. Since the beginning of the year, Tesla's sales in Europe have increased by 45%, outpacing the overall European eco-friendly vehicle (xEV) growth rate of 29%." He added, "If FSD approval is granted in Europe during the second half, sales will accelerate even further. Even if full approval is not obtained, Tesla plans to receive FSD approval in a considerable number of countries through individual national procedures. The Netherlands, Lithuania, and Estonia have already granted approval, while Ireland and Belgium are undergoing the approval process."

Recently, LG Energy Solution's North American subsidiary Vertech signed a battery energy storage system (BESS) supply contract worth approximately USD 1.6 billion with U.S. power company DTE Energy. Joo stated, "This investment is aimed at supporting the massive power demand of Oracle's data center, which raises high expectations for additional orders in the future." He added, "Considering the new order target of 90 GWh for 2026, the outlook for additional orders remains strong."

This content was produced with the assistance of AI translation services.