[Edaily Reporter kyoungeun kim ] Analysts are assessing that the rechargeable battery sector has emerged from a prolonged slump in earnings and is entering a rebound phase. Although the recovery in electric vehicle (EV) demand remains sluggish, expectations are growing that the sector has passed its earnings trough as new sources of battery demand—such as energy storage systems (ESS) in North America and artificial intelligence (AI) data centers—are emerging.
According to MP Doctor on the 17th, stock prices are already rapidly reflecting these expectations, with L&F(066970)surging 49.7%, SAMSUNG SDI CO.,LTD.(006400)rising 30%, and POSCO FUTURE M(003670)climbing 23.8% so far this month.
The trends driving this rebound can be summarized into three main categories: ESS is leading the recovery rather than EVs; among materials stocks, the ability to respond to lithium iron phosphate (LFP) has emerged as a new differentiating factor; and stock prices are moving ahead of actual earnings.

The most notable change is that the focus of battery demand is shifting from EVs to ESS. The expansion of AI data centers demands massive power consumption and a stable, 24-hour power supply. Coupled with the increasing share of renewable energy sources such as solar and wind—which requires ESS to offset fluctuations in power supply—a trend is emerging where production facilities originally secured for EVs are being converted to ESS, thereby simultaneously improving utilization rates and reducing fixed-cost burdens.
SAMSUNG SDI CO.,LTD. is considered the biggest beneficiary of this trend. According to the FnGuide Inc. consensus, SAMSUNG SDI CO.,LTD.’s third-quarter operating profit forecast stands at 93.6 billion won, marking an expected return to profitability from a 591.3 billion won loss in the same period last year; this represents a 262.7% upward revision from the forecast made just one month ago (25.8 billion won). The fourth-quarter operating profit forecast (221.9 billion won) has also risen by 24.2% over the past month.
The reason analysts have significantly raised their expectations for SAMSUNG SDI CO.,LTD.—following its second-quarter results, which far exceeded market expectations and marked a return to profitability—is that ESS sales are increasing, with ESS offsetting the slump in the EV sector. DaishinSecurities forecasts that SAMSUNG SDI CO.,LTD.’s ESS sales will expand from 4.2191 trillion won this year to 7.0057 trillion won by 2027.
While expectations are high that LG Energy Solution has passed its trough, the pace of profit recovery remains relatively slow. The third-quarter revenue consensus stands at 8.7671 trillion won, a 53.8% increase year-over-year, whereas operating profit is projected to decline by 49.1% to 305.9 billion won; forecasts have also been revised downward by 34.3% over the past month. While revenue recovery is stronger than expected, the pace of profit recovery is falling short of market expectations. The key issue is not simply revenue growth, but the profitability of the ESS business itself. Kim Gwi-yeon, an analyst at DaishinSecurities, stated, “We expect the ESS operating profit margin to return to profitability by the end of the year, excluding the Annual Manufacturing Production Credit (AMPC).” The fact that LG Energy Solution’s stock price rose by only 12.65% this month—a smaller increase than SAMSUNG SDI CO.,LTD.’s—appears to be linked to market sentiment focused on confirming actual margin improvements rather than mere expectations of ESS growth.
Differentiation is also emerging among materials suppliers. The key factor is their ability to respond to LFP demand. The most dramatic example is L&F. Demand from domestic battery manufacturers for Korean-made LFP cathode materials is stronger than expected, requests for capacity expansion from new customers are increasing, and full-scale mass production of LFP is expected to begin in the third quarter.
Cho Hyun-ryul, an analyst at SamsungSecurities, noted, “While L&F’s third-quarter sales of ternary cathode materials are expected to reach a record high, its earnings will likely remain weak due to falling lithium prices and other factors.” However, he added, “The recent strength in the stock price reflects market expectations for LFP as a new growth driver, rather than current profits.”
Earnings expectations for materials companies in the third quarter are not high due to falling lithium prices and exchange rates. POSCO FUTURE M’s third-quarter operating profit is projected to be 27.1 billion won, a 59.3% decrease year-over-year. ECOPRO BM CO., LTD. is also expected to see its operating profit drop by 61.4% to 19.5 billion won, while net profit is forecast to plummet by 91.9% to 4.0 billion won. L&F is expected to see operating profit rise 65.3% year-over-year to 36.6 billion won, but its forecast has been revised downward by 18.0% over the past month. The net profit forecast has also been lowered by 29.1%, from 15.3 billion won to 10.9 billion won.