LG Energy Solution's Price Target Cut to 550,000 KRW on ESS Growth Expectations

According to Shinhan Investment & Securities on July 6, the brokerage cut its price target for LG Energy Solution to 550,000 KRW from 600,000 KRW, citing line conversion costs pressuring profitability through the second quarter. However, the firm maintained its "buy" rating, citing accelerating energy storage systems (ESS) orders and revenue growth in the second half.

Shinhan estimated LG Energy Solution's second quarter operating profit at 246 billion KRW, exceeding market consensus of 203.4 billion KRW. The ESS segment is projected to see 46% higher revenue in the second half versus the first half, with major orders including contracts from DTE Energy, the largest integrated energy company in the U.S. Analyst Lee Jin-myeong noted that while ESS structural growth remains valid, share price recovery requires normalized profitability and reduced auto battery losses.