[Edaily Reporter Kim Kyung-eun] On the 18th, Samsung Securities lowered its target price for #L&F by 16% from 250,000 won to 210,000 won, reflecting the weak stock prices of its competitors. However, the firm maintained its “Buy” investment rating, noting that L&F’s fundamentals are actually improving.

Cho Hyun-ryeol, an analyst at Samsung Securities, stated, “Among domestic companies, L&F is expected to stand out for its technological leadership by being the first to mass-produce lithium iron phosphate (LFP) cathode materials.”

Samsung Securities assessed that L&F has secured a competitive edge in both the cylindrical cathode material and LFP cathode material sectors. In particular, the firm projected that L&F, as a key supplier, would continue to benefit as LG Energy Solution’s share within Tesla’s battery supply chain expands. It also cited the start of mass production of its clients’ 46-series batteries as a factor driving sales growth.

Analyst Cho noted “LG Energy Solution’s share of Tesla’s battery procurement has improved from 23% in 2024 to 33% this year, while CATL’s share has fallen from 34% to 24%,” he said, adding, “Given the priority allocation of LFP batteries to energy storage systems (ESS), the strong sales trend for LG Energy Solution and L&F—a key cathode material supplier—in the electric vehicle sector is expected to continue.”

The LFP cathode material business is also gaining momentum. L&F has completed construction of its LFP cathode material plant and plans to begin operations in the fourth quarter of this year. Initial production capacity is 30,000 metric tons per year, with plans to expand to 60,000 metric tons in the future.

Analyst Cho predicted, “Through the commercialization of South Korea’s first LFP cathode material, the company is expected to solidify its position as one of the few non-Chinese cathode material suppliers in the North American ESS market, leading to increased supply requests from customers beyond its existing contract clients.”

Second-quarter earnings are also expected to exceed market expectations. Revenue is projected to reach 962.8 billion won, a 30.2% increase from the previous quarter and above the market consensus (828.0 billion won), while operating profit is estimated at 47.3 billion won, in line with the consensus. Analysts predict that the sales volume growth rate will exceed previous forecasts due to stronger-than-expected demand for cylindrical cathode materials.