Are Secondary Battery Stocks Bottoming Out and Entering a Turnaround? BlackRock's Stake Acquisition Spotted

An analysis shows that a company's stock price increase rate is most elastic when it transitions from a deficit to a profit in the stock market. This is because improvements in a company's financial status act as a positive signal for investors. Additionally, for the market capitalization to increase significantly, the industry must be large-scale, thus a turnaround in a large-scale industry offers greater investment opportunities.

Day trading has been pointed out as being highly volatile, making it difficult to achieve consistent profits. If short-term losses are repeated, there is a need to fundamentally revise investment strategies. It was suggested that pursuing stable profits by shifting investment targets to industries aligned with current trends and export-oriented stocks is important.

The first reason cited for the secondary battery industry's turnaround is the signs of the three major domestic battery companies turning profitable. In particular, increasing demand for Energy Storage Systems (ESS) related to AI data centers is expected to be a new growth engine for the secondary battery industry. Furthermore, expectations for renewable energy subsidy policies, depending on the U.S. presidential election results, are also brightening the outlook for the secondary battery industry.

As the U.S. strengthens regulations on Chinese companies related to the drone and robot security industries, South Korean secondary battery companies have an opportunity to gain indirect benefits. With Chinese battery and material companies facing difficulties entering the U.S. market, Korea and Japan are emerging as alternatives. However, Japanese companies are conservative about expansion, making Korean companies the only alternative to fill that void.

As the commercialization of all-solid-state batteries approaches, there is growing anticipation that they will be a 'game changer' for the secondary battery industry. All-solid-state batteries can address the shortcomings of existing lithium-ion batteries, offering greater safety and higher energy density. Particularly as the role of batteries becomes more critical as an essential power source for the AI industrial revolution and advanced device development, all-solid-state batteries are projected to be a core future technology.

BlackRock, the world's largest asset manager, announced that it had secured a 5.01% stake in EcoPro as of July 15. This large-scale stake acquisition occurred during a period when EcoPro's stock price was actually declining, suggesting that BlackRock is investing strategically from a long-term perspective. This indicates a high valuation of the future growth potential of the secondary battery industry, irrespective of short-term market movements.

A divided purchase strategy focusing on secondary battery materials, components, and equipment (Sooboojang) companies with high entry barriers has been suggested as an investment strategy. In a situation where large-scale investments in the U.S. and indirect benefits from supply chain regulations are expected, these companies have a high potential for stable growth. In particular, targeting companies in a turnaround phase, moving from deficit to profit, was emphasized as an effective investment strategy.

The secondary battery industry is assessed to be on the cusp of turning profitable, even excluding the Advanced Manufacturing Production Credit (AMPC). This suggests that the industry's fundamental structure is improving. Furthermore, policy expectations are growing with the U.S. midterm elections scheduled for November 3. With the probability of Democrats becoming the majority party nearing 90%, renewable energy and electric vehicle-related policies are expected to be further strengthened.

The stock market is projected to remain in a box-range for the time being. The index is undergoing a period of adjustment, and this trend is expected to continue for some time. However, with Samsung Electronics and Hynix's ongoing share buybacks securing the market's downside rigidity, rather than a sharp decline, fluctuations within a limited range are anticipated.

Following the current period of stock market adjustment, a second AI industrial revolution rally is predicted. While the first upward phase was led by the semiconductor and transformer industries, secondary batteries are highly likely to become the new market leaders in the second rally. This analysis is based on strong expectations for the scale and earnings turnaround of the secondary battery industry and is expected to significantly influence future market trends.