[Edaily Reporter Kim Hyung-il ] DB Securities has lowered its earnings estimates for ECOPRO BM CO., LTD.(247540)and revised its target price down to 130,000 won, reflecting a decline in shipment volumes due to inventory adjustments by client companies and low factory utilization rates. However, the firm maintained its “Buy” rating, noting that a significant increase in shipment volumes is likely starting in 2028, so a long-term perspective is necessary.

On the 6th, DB Securities analyst Ahn Hoi-soo analyzed that ECOPRO BM CO., LTD.’s consolidated revenue for the third quarter of this year was 557.9 billion won, down 11% year-over-year and 3% quarter-over-quarter. Operating profit was 12 billion won, down 76% and 33%, respectively, but in line with market consensus.

The primary cause of the weak performance was a decline in sales volume due to inventory adjustments by clients. Sales volume fell 10% quarter-over-quarter as SAMSUNG SDI CO.,LTD. adjusted its inventory for BMW, causing the core business to slip into a slight loss. Sales volume for energy storage systems (ESS) temporarily increased compared to the previous quarter.

One-time expenses included costs associated with a temporary suspension of operations at the Hungarian plant due to an environmental inspection. However, this was offset by a reversal of inventory valuation losses, and approximately 14 billion won in R&D expenses were capitalized. As a result, the third-quarter operating profit margin stood at 2.2%.

The impact of customer inventory adjustments is expected to continue into the fourth quarter of this year. DB Securities projected that ECOPRO BM CO., LTD.’s fourth-quarter revenue would decline by 2.2% quarter-over-quarter to 545.5 billion won, while the company would post an operating loss of 11.6 billion won, marking a shift to the red. Amid continued sluggish shipment volumes and low capacity utilization rates, the firm anticipated that costs of approximately 7.0 to 8.0 billion won related to the suspension of operations at the Hungarian plant would be reflected in October as well.

However, the assessment is that, in the medium to long term, the operation of overseas production bases and new business ventures could serve as the foundation for a recovery in earnings. Driven by the start of operations at the Hungarian plant and increased volumes for Powerlet and BBLJ, shipments are projected to rise from 60,000 metric tons this year to 70,000 metric tons next year. The nickel smelter in Indonesia is also expected to begin operations and contribute to consolidated operating profit.

A notable new development in this earnings announcement is the plan for a 50,000-metric-ton LFP cathode material business. ECOPRO BM CO., LTD. is reviewing an investment in Indonesia that could reduce capital expenditures (CAPEX) by 20–30% compared to domestic investment, with the goal of commencing sales in 2028. It is also understood that the company is pursuing new orders worth several trillion won with global automakers.