Value of Battery Business to Be Raised
As SK Innovation announced the separation of its battery business during the Story Day event on July 1, evaluations of its future corporate value are mixed.
Concerns are growing that the value of SK Innovation may fall as the company announced a detailed plan to spin off its battery business division. In fact, the stock price of SK Innovation fell 8.8 percent on the day the Story Day event was held.
However, some analysts said that SK Innovation's spin-off of its battery business would have more positive aspects than negative ones.
"There are two conflicting effects expected to come from the spin-off," said Han Sang-won, a researcher at Daishin Securities. "The positive aspect is that the separation of the battery business offers an opportunity to re-evaluate the company’s value, while the negative aspect is that the IOP may dilute shareholders’ stakes and discount the value of the holding company."
"While the value of the battery business reflected in SK Innovation's market capitalization is estimated to be only five trillion won,” Han said. “Considering market values of other battery makers such as CATL (218 trillion won), LG Chem (60 trillion won), and Samsung SDI (50 trillion won), re-evaluating the company’s value will generate more positive effects than negative ones.”
"SK Innovation's battery business order backlog is batteries of 1TWh (estimated at 130 trillion won based on terawatt-hours and amounts), which is much larger than the previous estimate of 80 trillion won," Han said. "This is the second highest in the world after that of LG Energy Solution."