LG Energy Solution Ltd

LG Energy Solution maintains a capital structure characterized by significant leverage, with long-term debt of 22.5 trillion KRW against total equity of 20.2 trillion KRW, resulting in a debt-to-equity ratio of 1.11. The balance sheet shows total assets of 67.1 trillion KRW and total liabilities of 46.9 trillion KRW. Liquidity is assessed as medium, supported by a current ratio of 1.1 and cash and equivalents of 3.8 trillion KRW. However, the company reports negative net cash after subtracting total debt, indicating reliance on external financing or operating cash flow to service obligations. The market capitalization stands at 76.3 trillion KRW, with a price-to-book ratio of 3.77.

Profitability metrics reflect a period of financial strain, with net income at -1.07 trillion KRW, leading to a negative return on equity of -7.93% and a negative return on assets of -2.39%. Operating income is positive at 970.6 billion KRW, but this is insufficient to cover all expenses and financing costs, resulting in the net loss. The gross profit is 4.23 trillion KRW on revenue of 23.7 trillion KRW. The negative earnings per share result in an undefined or negative EV/EBITDA multiple, reported as -586.10, highlighting the current earnings deficit relative to enterprise value.

Revenue generation is driven by the company's core activities in automobile manufacturing and electrical equipment, as indicated by its sector classification classification in Industrials and Electrical Equipment. The financial snapshot does not provide a detailed breakdown of revenue by segment or geography, limiting the analysis of concentration risk to the overall industry classification. The company's activity is centered on automobile manufacturers, suggesting exposure to the cyclical nature of the automotive supply chain and the transition to electric vehicles.

Growth trajectory analysis is constrained by the absence of historical period data in the provided input. The current revenue of 23.7 trillion KRW represents the latest normalized period performance. Without multi-year historical data, it is not possible to assess year-over-year growth rates or long-term trends in revenue and net income. The current capital expenditure of -11.0 trillion KRW suggests significant ongoing investment in capacity or technology, which may support future growth but currently contributes to negative free cash flow.

Risk assessment identifies medium liquidity risk and low dilution risk. The key flag notes that net cash is negative after subtracting total debt, which poses a refinancing risk if operating cash flows do not improve. The negative free cash flow of -7.2 trillion KRW, driven by high capital expenditures of -11.0 trillion KRW against operating cash flow of 4.4 trillion KRW, underscores the cash-intensive nature of the current business phase. The company must manage its debt levels carefully to maintain financial stability.

Recent observations from investor relations indicate strong analyst sentiment, with a mean recommendation of 1.81 (where 1 is strong buy). The mean price target is 517,296.30 KRW, significantly higher than the current market price of 326,000.00 KRW, suggesting expected upside. There are 11 strong-buy and 17 buy ratings, compared to only 3 hold ratings. This positive outlook contrasts with the current negative net income, implying that analysts expect a turnaround in profitability or value creation from future growth initiatives.

LG Energy Solution Ltd (373220.KS) has experienced no material changes relative to prior analysis, with monitoring of 17 fields yielding no significant shifts. The absence of new developments is further underscored by a lack of active watcher signals and a near-total absence of cross-source news dispatches over the past month. Specifically, news activity remained at zero from June 25 through July 6, 2026, with only a single dispatch recorded on July 7. This minimal media footprint suggests a period of operational quiet or a lack of newsworthy events for the company during this timeframe. The company’s profile currently reflects zero counts for officers, analysts, index memberships, and top holders in the available data. This static profile, combined with the lack of material changes, indicates that the fundamental structure and market attention surrounding LG Energy Solution have remained unchanged. Consequently, there are no new catalysts or risks to report for investors based on the current data. The stability in both news flow and corporate metrics implies that the company’s trajectory remains consistent with previous assessments, offering no new information to alter investment theses.

Analysts project 56.5% upside to a mean price target of 517,296 KRW, reflecting strong buy consensus.

Operating income surged 42.8% year-over-year to 970.6 billion KRW, demonstrating improved operational efficiency.

Free cash flow improved by 20.9% year-over-year, indicating better cash generation despite negative absolute values.

Revenue maintained a 7.3% four-year CAGR, showing long-term top-line growth resilience in the sector.

Gross profit reached 4.23 trillion KRW in FY2026, providing a substantial base for potential margin recovery.

The company faces high credit risk and medium liquidity risk, signaling significant financial stability concerns.

Net income deteriorated to a 1.07 trillion KRW loss in FY2026, worsening from the prior year's deficit.

Long-term debt ballooned to 22.5 trillion KRW in FY2026, creating a heavy leverage burden.

Operating and net margins rank in the bottom quartile of the Automobiles cohort, indicating poor profitability.

Revenue KRW 6.55T, +4,6% YoY; Operating income −306,5% YoY.

• ▍Revenue KRW 6.55T, +4,6% YoY
• ▍Operating income −306,5% YoY
• ▍Net income −363,8% YoY
• ▍Free cash flow +28,6% YoY
• ▍Net margin -10.3%

Revenue KRW 6.14T, −4,8% YoY; Operating income −118,7% YoY.

• ▍Revenue KRW 6.14T, −4,8% YoY
• ▍Operating income −118,7% YoY
• ▍Net income −29,0% YoY
• ▍Free cash flow +29,1% YoY
• ▍Net margin -14.3%

Revenue KRW 5.70T, −17,1% YoY; Operating income +8,3% YoY.

• ▍Revenue KRW 5.70T, −17,1% YoY
• ▍Operating income +8,3% YoY
• ▍Net income +85,6% YoY
• ▍Free cash flow +31,8% YoY
• ▍Net margin 4.3%

Revenue KRW 5.57T, −9,7% YoY; Operating income +152,0% YoY.

• ▍Revenue KRW 5.57T, −9,7% YoY
• ▍Operating income +152,0% YoY
• ▍Net income +37,0% YoY
• ▍Free cash flow +10,4% YoY
• ▍Net margin -5.3%

Revenue KRW 6.26T; Operating income KRW 369.11B.

• ▍Revenue KRW 6.26T
• ▍Operating income KRW 369.11B
• ▍Net margin -2.3%

Revenue KRW 6.45T; Operating income -KRW 223.09B.

• ▍Revenue KRW 6.45T
• ▍Operating income -KRW 223.09B
• ▍Net margin -10.5%

Revenue KRW 6.88T; Operating income KRW 550.34B.

• ▍Revenue KRW 6.88T
• ▍Operating income KRW 550.34B
• ▍Net margin 1.9%

Revenue KRW 6.16T; Operating income KRW 195.32B.

• ▍Revenue KRW 6.16T
• ▍Operating income KRW 195.32B
• ▍Net margin -7.7%

Revenue KRW 23.67T, −7,6% YoY; Operating income +42,8% YoY.

• ▍Revenue KRW 23.67T, −7,6% YoY
• ▍Operating income +42,8% YoY
• ▍Net income −5,3% YoY
• ▍Free cash flow +20,9% YoY
• ▍Net margin -4.5%

Revenue KRW 25.62T, −24,1% YoY; Operating income −68,4% YoY.

• ▍Revenue KRW 25.62T, −24,1% YoY
• ▍Operating income −68,4% YoY
• ▍Net income −182,3% YoY
• ▍Free cash flow −49,7% YoY
• ▍Net margin -4.0%

Revenue KRW 33.75T, +31,8% YoY; Operating income +77,0% YoY.

• ▍Revenue KRW 33.75T, +31,8% YoY
• ▍Operating income +77,0% YoY
• ▍Net income +61,2% YoY
• ▍Free cash flow −65,9% YoY
• ▍Net margin 3.7%

Revenue KRW 25.60T, +43,4% YoY; Operating income +57,2% YoY.

• ▍Revenue KRW 25.60T, +43,4% YoY
• ▍Operating income +57,2% YoY
• ▍Net income −3,2% YoY
• ▍Free cash flow −168,7% YoY
• ▍Net margin 3.0%