By Kwanwoo Jun
Lotte Energy Materials’ shares climbed Wednesday after news that it plans to quadruple copper-foil production in the next five years.
Shares of the South Korean copper-foil maker rose as much as 14% to 55,400 won ($42.79) in morning trade, on course for their sharpest daily percentage gain in 21 months, according to FactSet.
The benchmark Kospi was last down 0.3%.
Lotte Energy Materials Chief Executive Kim Yeon-seop told a news conference Tuesday in Seoul that the company plans to ramp up annual copper-foil production to 240,000 tons by 2028, four times the current output capacity of 60,000 tons a year, South Korean state news agency Yonhap reported.
Copper foil is a key material used to wrap the anode of lithium-ion batteries for electric vehicles.
Kim said his company aims to boost its backlog of orders up to KRW20 trillion by 2025, versus a targeted KRW15 trillion in 2023, and grab a 30% share of the global copper-foil market, according to Yonhap.
DB Financial Investment in a recent research note said that Lotte Energy’s copper-foil production expansion in Malaysia, where electricity tariffs are relatively cheap, looks set to boost profitability. The company is also poised to benefit from the recovery of demand from clients, it said.
DB Financial initiated coverage of the stock with a buy rating and KRW83,000 target price.
Write to Kwanwoo Jun at [email protected]
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