A number of winners and losers have emerged from recent developments in the battery industry, according to analysts from Goldman Sachs, as it forecasts a “more rapid decline” in prices. One key beneficiary is likely to be the electric vehicle sector. “We can see a side of consumer EV adoption begin[ning] as battery prices are falling more rapidly than we thought,” analyst Nikhil Bhandari told CNBC’s ” Street Signs Asia ” on Friday. “It’s more a virtuous cycle —lower battery prices mean more competitively priced EV cars [and in turn] higher adoption and higher demand.” While prices of lithium — a key component in batteries — are already down 70%, Bhandari believes “there is more to go” in terms of the fall in battery prices. “We think battery prices can fall to $99 per kilowatt hour (KwH) at a pack level by 2025 — a 40% decline from 2022,” Bhandari said, adding that a consumer-led adoption phase for EVs would likely begin if battery prices fall below $100 per KwH. There are some risks that could dent this projection, including surplus in the lithium market, driven by supply from markets such as China, Africa and Latin America, Bhandari noted. Technological developments such as direct lithium extraction could also cause a shake-up in battery prices. Battery market ‘winners’ Despite some potential risks, Bhandari identified several global stocks that look set to gain from the fall in battery prices. Among Goldman’s list of “winners” are Korean chemical and battery company LG Chem, Chinese thermal management player Envicool, and inverter manufacturer GoodWe, it revealed in an Oct. 3 note. All three are on the bank’s conviction list of top buy-rated stocks that it expects to outperform. It has a target price of 810,000 Korean won ($601.69) for LG Chem — giving it around 62% potential upside from its Oct. 9 close — and 290 renminbi (39.77) for Goodwe, or around 120% upside. Goldman has a 49.5 renminbi price target on Envicool, giving it an upside of 84%. Other related stocks on Goldman’s buy list include Chinese new energy vehicle maker BYD and Japanese conglomerate Panasonic . It gives BYD a price target of 321 Hong Kong dollars ($41.05), or upside of around 36%, while Panasonic has a 2,100 yen ($14.11) target, giving it an upside of 36%. Battery market ‘losers’ Goldman also revealed a list of potential “losers” in the battery market, or stocks it has a sell call on right now. Among the names are Chinese battery makers CALB — which the bank described as having a “low-margin-driven-growth business model” — as well as Gotion, a company the bank said had “a product mix mainly focusing on the price sensitive mini-van market.” The bank has a price target of 12.3 Hong Kong dollars on CALB, giving it a downside of 37% from its Oct. 9 close. It gives Gotion a 22.6 Renminbi price target, or 1.8% downside. — CNBC’s Naman Tandon contributed to this report.
Sumber: www.cnbc.com
