Business · Companies · 1 hr ago
Seojin System’s US battery-storage costs weigh on profit outlook
iM Securities lowered its target price for Seojin System from 68,000 won to 65,000 won, while keeping its buy rating.
The Korean company makes hardware and assembles products for energy storage systems, or ESS, as well as supplying semiconductor equipment.
Start-up costs at its US ESS plant are expected to weigh on profit, even as delayed factory preparations are complete and shipments have recovered.
The firm estimates Seojin System will post 1.817 trillion won in annual revenue and 68 billion won in operating profit, with the revenue figure a possible record.
ESS and semiconductor equipment are driving sales growth: the broker estimates third-quarter revenue in those businesses rose 287% and 220%, respectively, from a year earlier.
Samsung SDI plans to expand US ESS cell capacity to as much as 30 GWh by the end of 2027, which could benefit Seojin System as its sole supplier of hardware and assembly for Samsung SDI’s finished ESS products.
iM Securities lowered its target price for Seojin System from 68,000 won to 65,000 won, citing costs from starting operations at its US energy-storage-system factory.
The brokerage kept its buy rating and expects Seojin System to post record annual revenue of 1.817 trillion won.
It estimated third-quarter revenue of 529 billion won and operating profit of 54.2 billion won.
Its full-year operating-profit estimate was cut from 132 billion won to 68 billion won.
The brokerage said US energy-storage shipments had normalised from the third quarter and semiconductor-equipment sales continued to grow.
- Who
- Seojin System, a battery-storage and semiconductor-equipment supplier.
- What
- iM Securities lowered its target price while maintaining a buy rating, citing costs tied to the start-up of the company’s US energy-storage factory.
- When
- The report was published on October 25, 2026; it refers to third-quarter results and forecasts for the year.
- Where
- The United States, including Seojin System’s Houston and Indiana factory operations.
- Why
- Initial factory operating costs weighed on the profit outlook, although the brokerage expected revenue growth from energy-storage shipments and semiconductor equipment.
This story does not have two clearly opposing sides.
Seojin System’s US energy-storage assembly factory preparations were completed, and shipments normalised, according to iM Securities.
iM Securities estimated revenue of 529 billion won and operating profit of 54.2 billion won.
Samsung SDI plans to convert part of its Indiana electric-vehicle production line to a lithium iron phosphate line for energy storage.
Samsung SDI plans to expand US energy-storage cell production capacity to as much as 30 GWh.
- Target price
- Cut from 68,000 won to 65,000 won
- Full-year revenue estimate
- 1.817 trillion won
- Full-year operating-profit estimate
- 68 billion won, down from 132 billion won
- Third-quarter energy-storage revenue estimate
- 215 billion won, up 287% year on year
- Third-quarter semiconductor-equipment revenue estimate
- 220 billion won, up 220% year on year
- Samsung SDI US energy-storage capacity plan
- Up to 30 GWh by the end of 2027
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What people are saying
The delayed improvement in results followed upfront investment to expand production capacity and delays in customers’ production schedules, but I view the third quarter as the initial stage in which the investment is translating into sales.
With strong demand for semiconductor equipment and major domestic battery makers expanding their energy-storage businesses at the same time, I believe a full-scale share-price rise can be expected once the effects of operating leverage from revenue growth become visible.