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Reflecting the expectation of improved refinery margin and increased EV battery orders, Korean securities firms raised the target stock price of SK Innovation massively on the prospect of favorable performances.<\/span><\/p>\n <\/p>\n Researcher Baek Young-chan of KB Securities announced in a report dated April 19 that they will raise the target stock price by 10.3% to KRW 375,000, reflecting \u201c\u25b2 The expectation of an increase in 2021 operating profits of refining business by 50.6% due to the prospect of increased global oil prices and petrol prices, \u25b2 an 18.6% increase in net profits of company-wide governing shareholders, and \u25b2 increase in orders from resolving uncertainties of EV batteries.\u201d<\/span><\/p>\n <\/p>\n In this report, Baek said, \u201cAn increase in refining margin is expected after June\u201d, \u201cThis is mainly because of the bullish market prices of petroleum upon the expectation that the driving season will begin in the US after the vaccination of COVID-19.\u201d\u00a0He analyzed, \u201cThe inventory level of petroleum in the US stays around 208,000 barrels as of the second week of April, which is 7.8% lower year-over-year, and lower than 5-year average\u201d, \u201cIf the demand surges in June to July while such low inventory level continues, a short-term surge in petrol prices is inevitable.\u201d<\/span><\/p>\n <\/p>\n He emphasized, \u201cThe sales and operating profits of SK Innovation in Q1 this year recorded KRW 9.4236 trillion and 424.6 billion respectively (shifted to surplus year-over-year), which is a great improvement from last year, well beyond the consensus.\u201d\u00a0He added, \u201cThe composite refining margin in the Q1 was USD 6.9 per barrel, which is up USD 2.5 from the previous quarter\u201d, and analyzed that \u201cThe composite refining margin increased because of both the timing lag effect from the rise in the global oil prices and the rise in profitability of petrol.\u201d<\/span><\/p>\n <\/p>\n In the same report, Baek said, \u201cAs of the end of last year, the cumulative order balance of SK Innovation’s EV battery was estimated around KRW 70 trillion\u201d, and estimated, \u201cAs they resolved uncertainties, they will be able to take additional orders from car makers.\u201d\u00a0As such, Baek highlighted, \u201cA massive external growth is expected with the sales amount of the EV battery business sector this year increasing by 96% year-over-year to KRW 3.156 trillion.\u201d\u00a0He also added, \u201cThe EV battery production capacity will also swiftly increase from 30 GWh in 2020 to 40 GWh in 2021 and 65 GWh in 2022.\u201d<\/span><\/p>\n <\/p>\n Meanwhile, Lee Jin-myung, a researcher at Shinhan Investment Corp., stated, \u201cSK Innovation’s stock prices will be re-rated as the EV battery’s business values increase (from KRW 12 trillion to 17 trillion) with the resolution of uncertainties,\u201d and proposed the target stock price of KRW 380,000, up by 15%.<\/span><\/p>\n <\/p>\n Lee emphasized, \u201cThe steepest growth among Korea’s battery cell producers is expected of SK Innovation’s EV battery production capacity to 85 GWh (annual average + 42%) as of 2023, among which the US factory will account for 25%, and the performance growth from the expansion of the U.S. EV market is also anticipated.\u201d\u00a0He stated, \u201cSK Innovation’s EV battery order balance as of Q4 last year was 550 GWh (approximately KRW 70 trillion), and there is high potential for additional orders\u201d,\u00a0\u201cThe break-even point (BEP) for EV battery will be fast-forward with the measures such as aggressive extension of production capacity.\u201d<\/span><\/p>\n <\/p>\n In this report, Lee predicted, \u201cThe main business fields of SK Innovation are expected to see a massive improvement in performance\u201d, \u201cThe refining business is expected to make a turnaround in the second half of the year upon the recovery of demand after the expansion of vaccination against COVID-19, and the chemical and lubricants business are expected to break records when the demand increases after the global economy recovers.\u201d<\/span><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Reflecting the expectation of improved refinery margin and increased EV battery orders, Korean securities firms raised the target stock price of SK Innovation massively on the prospect of favorable performances. Researcher Baek Young-chan of KB Securities announced in a report dated April 19 that they will raise the target stock price by 10.3% … Read more<\/a><\/p>\n","protected":false},"author":564,"featured_media":4889,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3,347],"tags":[35,34,15],"class_list":["post-4884","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-insight","category-trend_report","tag-battery","tag-electric-vehicles","tag-sk-innovation"],"acf":[],"_links":{"self":[{"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/posts\/4884","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/users\/564"}],"replies":[{"embeddable":true,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/comments?post=4884"}],"version-history":[{"count":9,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/posts\/4884\/revisions"}],"predecessor-version":[{"id":4964,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/posts\/4884\/revisions\/4964"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/media\/4889"}],"wp:attachment":[{"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/media?parent=4884"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/categories?post=4884"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/askinno.com\/global\/wp-json\/wp\/v2\/tags?post=4884"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}