LG Energy Solution CEO and vice chairman Kwon Young-soo has claimed in a conference of the company’s IPO that it will overtake CATL, the world’s largest battery maker, in the future.
Kwon said that LG Energy Solution’s market capitalization is currently behind CATL but the pair would soon be "competing on equal footing."
LG Energy Solution is preparing to set its share price this week on Friday ahead of its IPO.
The company is expected to be valued at around 70 trillion won, with analysts expecting it to hit 100 trillion won after it goes public.
As of Monday, CATL’s market capitalization is 234 trillion won, over triple that of LG Energy Solution’s initial valuation.
Kwon said that CATL had enjoyed high profitability from selling batteries at a “good price” in China so far.
But LG Energy Solution had more remaining orders compared to the Chinese battery giant, the CEO said. When CATL builds factories outside of China in areas such as Europe, “the situation will change,” he claimed, implying that the South Korean battery maker is better positioned to compete in markets outside of China compared to CATL.
LG Energy Solution had 260 trillion won worth of remaining orders from car batteries, which will allow the company to grow over 25% per year and have a double-digit operating margin, Kwon said.
Meanwhile, in lithium iron phosphate (LFP) batteries, LG Energy Solution aims to enter the energy storage systems market first, the CEO said.
On how it plans to compete with leading Chinese companies in the sector once LG Energy Solution starts supplying LFP batteries to the electric vehicle market, Kwon said its batteries will offer high performances.
Meanwhile, out of the around 12 trillion won in funding expected from the IPO, LG Energy Solution plans to spend 5.6 trillion won up to 2024 to expand its battery production in South Korea, Europe and China, the CEO added.