April 20, 2024

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[THE INVESTOR] POSCO ChemTech is garnering expectations for growth as the sole secondary battery material manufacturer within POSCO group, said HI Investment and Securities on Nov. 6 maintaining a “buy” recommendation and 94,000 won (US$83.73) target price.

The company is the nation’s sole producer of anode material made of natural graphite. It has built up the manufacturing capacity to 12,000 tons a year and is planning to increase it to 64,000 tons by 2020. It has set a target to reach 20 percent global market share in battery materials, reaping 17 trillion won in revenue. From 2021 it will be able to extract lithium hydroxide and lithium carbonate which will be utilized for POSCO ESM’s cathodes. The chemicals will begin to serve as new growth momentum accounting for over 15 percent revenue of the company, said analyst Lee Sang-heon.

POSCO is also mulling merging ChemTech and ESM, expecting to create synergies. Following this, ChemTech’s growth potential will be further highlighted, the analyst noted.

By Hwang You-mee (glamazon@heraldcorp.com)