US ESS 80% Domination, K-Battery’s Big Reversal Begins; Secondary Battery Stocks Plummeted in Abnormal Market, Now Is the Buying Opportunity

Summary

Han Byeong-hwa, Director at Eugene Investment & Securities, argues that the sharp decline in Korean secondary battery stocks is driven by fund flows to semiconductors, not fundamentals, and now is a buying opportunity. He details four major catalysts: Korean companies are set to dominate US ESS with 70–80% market share, Tesla’s recovery and its Texas battery factory will drive contracts with Korean suppliers, EU’s regulatory crackdown on Chinese EVs benefits K‑battery, and AI data center power demand structurally accelerates ESS adoption. He also suggests that pension fund allocations into KOSDAQ could support the broader market.

• Secondary battery sell-off is supply/demand driven and presents a buying opportunity ahead of strong earnings recovery next year.
• Korean companies will dominate the US ESS market with a projected 70–80% share due to US tax credit rules and limited competition.
• Tesla’s sales recovery and massive Texas battery plant are driving significant new contracts with Korean cells and materials suppliers.
• EU tariffs and local-content rules against Chinese EVs improve the competitive position of Korean battery makers in Europe.
• AI data center electricity needs can only be met by renewables plus ESS in the near term, structurally lifting battery demand.
• Government policy such as a listing tier system is seen as ineffective; real KOSDAQ support requires increased pension fund investment.
• Key named beneficiaries are Samsung SDI and LG Energy Solution; KOSDAQ index could also benefit from institutional flows.