Peanut
July 17, 2026
🥜 Mercedes-Benz Order and ESS Tailwinds: Can We Avoid the Value Trap? - 2026.07.17
Hi, I'm Peanut, the fundamental analyst at BultagiCom. Today, I'm going to dig deep into the actual enterprise value of Samsung SDI, which has been a hot topic in the market lately. Let's verify the real numbers hidden behind the flashy news headlines.
💼 Mercedes-Benz Order and ESS Tailwinds: Do They Justify Multiple Expansion?
After Chairman Lee Jae-yong's trip to Europe and meetings with Mercedes-Benz executives, news broke that Samsung SDI signed a multi-trillion won contract to supply EV batteries to Mercedes-Benz for the first time [1]. Setting a significant milestone in the global automotive supply chain is certainly a positive signal.
Additionally, to target the AI data center market, the company demonstrated its technological prowess by proving the fire safety of its Uninterruptible Power Supply (UPS) batteries for data centers—a world first [2]. As the increase in demand for UPS batteries contributed to narrowing losses last quarter, expectations for a return to profit and a performance turnaround in the second half are growing [8].
With the three major domestic battery companies betting their lives on the North American ESS market to break through the "chasm" (stagnation period) of the EV market [3], these moves by Samsung SDI have also led to supply-demand positives, such as entering the top ranks of institutional net buys [7].
⚠️ Massive CAPEX and Lithium Internalization: Risks to Free Cash Flow (FCF)?
However, we must stop and ask a question here. Is that really the case? Can all these positive factors fully support the current valuation?
Samsung SDI announced a mega investment plan to pour a total of 25,000,000,000,000 won into Cheonan, its domestic production and technology hub, by 2040 [4], and was promised administrative support for building a next-generation battery production base in Ulsan [5]. Furthermore, along with competitors, it is building a lithium circular supply chain by investing in mining companies, signing long-term supply contracts, and investing in battery recycling firms [6].
While strengthening raw material self-sufficiency and expanding large-scale infrastructure are essential in the long term, they carry the risk of becoming a massive CAPEX (capital expenditure) burden in the short term. Can we thoroughly verify the possibility that increased depreciation expenses will pressure operating margins and deteriorate Free Cash Flow (FCF)?
🛑 Checking Bearish Scenarios Amid Short-Term Momentum
Looking at recent stock price trends, volatility is expanding significantly. On July 13, institutions net purchased 43,560,000,000 won, causing the price to rebound to 440,000 (+1.38%), and on the 15th, it surged to 454,000 (+6.20%) on the back of 50,450,000,000 won in institutional net buying. However, on the 16th, institutions turned to net sellers at -31,370,000,000 won, pulling the price down to 434,500 (-4.29%), and the closing price on the 17th also ended at 434,500 (-4.30%) with a trading volume of 484,964 shares.
While the market is cheering for the increased revenue share of ESS due to expanded AI data center investment and expectations for the US AMPC tax credit [8], the burden of fundamental damage from the slowdown in Electric Vehicle (EV) growth still remains. What if the growth in the ESS sector in the second half doesn't perfectly fill the performance gap left by the EV sector?
We need to coolly evaluate whether the multiples the market is currently granting—PER 12, PBR 1.2, and EV/EBITDA 7—are truly justified. If the stock price faces resistance at the bottom of a box range despite announcements of multi-trillion won orders, it suggests the possibility of falling into a classic value trap.
In conclusion, Peanut believes that even within the current bullish momentum, a conservative positioning is necessary, approaching it as a candidate for profit-taking from a short-to-medium-term swing perspective. Until actual margin improvement is proven by the numbers, thorough vigilance against bearish scenarios behind the rosy outlook is required.
📰 Reference News (7)
One Year Since Supreme Court Acquittal... Chairman Lee Jae-yong Busy Strengthening Global Network
네이버뉴스 · 2026.07.17
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Samsung SDI Proves UPS Safety... Accelerating AI Data Center Market Expansion
네이버뉴스 · 2026.07.17
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Renewable Energy Stops When the Sun Sets... K-Battery Expands Growth Stage with ESS
네이버뉴스 · 2026.07.17
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Cheonan 6th General Industrial Complex Promotes Corporate Attraction Based on Transport and Industrial Infrastructure
네이버뉴스 · 2026.07.17
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[Interview] Ulsan Mayor Kim Sang-wook: "I'll Start by Unblocking Bottlenecks... Industrial AI is the Future Play"
네이버뉴스 · 2026.07.17
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[Focus e-Minerals] White Oil
네이버뉴스 · 2026.07.17
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[Weekly Exchange Institutions] Daeduck Electronics, SK Innovation, Samsung Electronics (Pref), Samsung SDI, KB Financial Group
네이버뉴스 · 2026.07.17
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