PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close
SungEel HiTech posted a swing to consolidated operating profit and owner net profit in the second quarter of 2026, signaling a possible exit from the losses that had persisted since the third quarter of 2023.
Q2 2026 operating profit of KRW 6.3 billion and owner net profit of KRW 8.4 billion mark the first quarterly profit in 12 quarters.
2025 consolidated revenue reached KRW 194.6 billion (+42.9% year over year), while the operating loss of KRW 54.5 billion narrowed 23.6% from the prior year.
Rising utilization at the Saemangeum Hydro Center No.3 plant and higher cobalt, nickel and lithium prices drove the earnings improvement.
Expansion permitting for the Batonyterenye plant in Hungary has been temporarily halted by a local court injunction, with an appeal now pending.
The debt ratio climbed to 367.6% at end-2025 from 44.4% at end-2022, and operating cash flow has stayed negative for multiple years.
SungEel HiTech is a battery recycling specialist established in March 2017 when the secondary-battery recycling division was spun off from SungEel HiMetal.
Its business is split into pre-treatment, which dismantles and shreds spent batteries into black mass, and post-treatment via hydrometallurgical Hydro Centers that recover nickel, cobalt, lithium and manganese.
Domestically, the Gunsan No.1 and No.2 plants have aged, while the highly efficient Hydro Center No.3 in Saemangeum now serves as the core production hub for lithium, nickel and cobalt.
Overseas sites are spread across Hungary, India, Malaysia, Poland, Indonesia and the United States, and as of 2025 the company had secured total capacity of about 95,000 tons (25GWh) across six countries.
In Batonyterenye, Hungary, the company completed Plant 1 in 2019 and Plant 2 in 2021, giving it 60,000 tons of black-powder processing capacity, the largest overseas production footprint the company holds.
Samsung SDI is a key customer and also the third-largest shareholder with roughly an 8% stake, having served as a strategic investor supplying materials and offtake since the company's early days.
SungEel HiTech has also signed a cobalt and nickel sulfate supply contract with Morocco-based COBCO, and is now discussing scrap-processing cooperation with Ecopro, which is preparing to ramp up its cathode material plant in Hungary.
Competitively, the company's track record recycling NCM and NCA ternary batteries, combined with preparations to commercialize LFP battery recycling amid rising demand for that chemistry, is seen as giving it relatively broad product coverage.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩64B | -₩17.4B | −27.2% |
| 2025Q3 | ₩43.8B | -₩12.3B | −28.1% |
| 2025Q4 | ₩53.4B | -₩9.3B | −17.5% |
| 2026Q1 | ₩60.9B | -₩4,140,963 | −0.0% |
| 2026Q2 | ₩76.8B | ₩6.3B | 8.2% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩269.9B | ₩48.3B | ₩39.3B | 17.9% | 13.5% | 44.4% |
| 2023 | ₩247.4B | -₩8.3B | ₩24.8B | −3.4% | 8.0% | 77.4% |
| 2024 | ₩136.2B | -₩71.4B | -₩110.1B | −52.4% | −54.1% | 202.3% |
| 2025 | ₩194.6B | -₩54.5B | -₩77.6B | −28.0% | −61.1% | 367.6% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04
2025 consolidated revenue came in at KRW 194.6 billion, up 42.9% from KRW 136.2 billion in 2024, but the operating loss of KRW 54.5 billion marked a third straight year of losses.
Still, the loss narrowed 23.6% from KRW 71.4 billion in 2024, and the operating margin improved from -52.4% to -28.0%, suggesting the trough had passed.
In 2022 the company posted peak results with revenue of KRW 269.9 billion and operating profit of KRW 48.3 billion (a 17.9% margin), before revenue fell to KRW 247.4 billion in 2023 and an operating loss of KRW 8.3 billion emerged.
Notably, 2023 still produced owner net profit of KRW 24.8 billion despite the operating loss, a year in which operating and net results diverged. 2024 was the worst year, with revenue shrinking to KRW 136.2 billion and the owner net loss widening to KRW 110.1 billion.
On a quarterly basis, losses gradually narrowed from revenue of KRW 64.0 billion and an operating loss of KRW 17.4 billion in Q2 2025, to KRW 43.8 billion revenue and a KRW 12.3 billion loss in Q3, and KRW 53.4 billion revenue with a KRW 9.3 billion loss in Q4.
In Q1 2026, revenue reached KRW 60.9 billion with the operating loss shrinking to roughly KRW 40 million, nearly breakeven, and in Q2 2026 revenue climbed to KRW 76.8 billion with operating profit of KRW 6.3 billion and owner net profit of KRW 8.4 billion, the first quarterly profit since the third quarter of 2023.
On cash flow, 2025 operating cash flow was negative KRW 22.8 billion, an improvement from negative KRW 55.3 billion in 2024 but still negative, while the debt ratio at end-2025 stood at 367.6%, sharply higher than 44.4% at end-2022.
The global battery recycling market is entering a phase of rising volume as batteries from early electric vehicle sales reach the end of their 8-to-10-year life, with the market projected to grow at a roughly 17% annual rate to about $208.9 billion by 2040.
Europe has been advancing regulation that designates black mass and battery scrap as hazardous waste, restricting exports to non-OECD countries, a policy seen as favorable for SungEel HiTech given its in-region hydrometallurgical capacity.
Cobalt prices, a key input cost, are directly shaped by the Democratic Republic of Congo's export policy; Congo imposed an outright export ban in 2025 before shifting to a quota system, setting annual export caps of 96,600 tons for both 2026 and 2027.
More recently, however, reports indicate Congo's cobalt exports have been picking up again under the new regime, causing the prior price rally to reverse.
Domestically, competitors such as Ecopro CnG are also racing to secure black mass, but because the electric vehicle market is still relatively young, the volume of retired batteries remains insufficient, leaving the industry broadly challenged to lift plant utilization.
Against this backdrop, SungEel HiTech is seen as holding a relative edge, having been the first EU-entering company to obtain environmental permits for wet scrap processing at its Hungary plant and having accumulated a substantial track record recycling NCM and NCA ternary batteries.
Brokerages estimate SungEel HiTech's 2026 revenue guidance at roughly KRW 300 billion, based on the assumption that Saemangeum Hydro Center No.3 utilization approaches 100% in the third quarter while Plant No.2 utilization rises to 40-50%.
Q2 2026 results, with revenue of KRW 76.8 billion and operating profit of KRW 6.3 billion, already turned positive in a pattern consistent with this utilization recovery scenario.
Overseas, the Hungary subsidiary turned monthly-profitable in November 2025 and stayed profitable in Q1 2026, with the company expecting profitability to continue into the second quarter as well.
However, expansion permitting to raise the Batonyterenye plant's processing capacity to 27,400 tons per year has been temporarily suspended by a court injunction sought by the local municipality, and both the company and Hungary's energy ministry have filed appeals that remain pending.
Growth initiatives include expanding the Indiana plant following a memorandum of understanding with the state of Georgia, along with consideration of new post-treatment sites in Hungary, Germany and Spain.
LFP battery recycling is reportedly being prepared for commercialization in 2026 via a pilot line, which could become an additional axis of product diversification.
More recently, the company has reportedly been discussing scrap-processing cooperation with Ecopro tied to the ramp-up of Ecopro's cathode material plant in Hungary, which if finalized could help lift utilization at the Hungary plant.
With the Q2 2026 turn to profit now confirmed, the share price has been moving within the trading band formed over the past year, and compared with the near three-year loss-making stretch, market attention appears to be shifting toward the earnings recovery narrative.
The price-to-book ratio trades at a level reflecting a substantial premium to net assets, which can be read as an early pricing-in of expectations tied to the profit turnaround. With owner net losses still recorded over the most recent four quarters, applying earnings-based valuation metrics remains premature.
The company currently pays no dividend, so dividend-related appeal is limited.
Sell-side target prices have been raised repeatedly on improving earnings expectations: IBK Securities set a target of KRW 60,000 in its March 2026 report, Samsung Securities set KRW 92,000 in its May 2026 report, and Eugene Investment & Securities set KRW 94,000 in its May 2026 report.
These figures, however, are each brokerage's own estimates based on their earnings forecasts and valuation methodologies such as EV/EBITDA or P/E, and should be treated as reference points separate from actual price movement.
PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04
Consolidated operating profit turned positive at KRW 6.3 billion in Q2 2026, with owner net profit reaching KRW 8.4 billion. This is read as the combined result of rising utilization at Saemangeum Hydro Center No.3 and improved selling prices from higher cobalt, nickel and lithium prices.
The progression from near-breakeven in Q1 to profit in Q2 aligns with the company's plan to push Plant No.3 toward full utilization.
The EU's push to restrict black mass exports to non-OECD countries could give SungEel HiTech, with its in-region hydrometallurgical capacity, an edge in securing raw materials.
Samsung SDI remains a strategic investor with roughly an 8% stake, and the company is also discussing scrap-processing cooperation with Ecopro ahead of the latter's Hungary cathode plant ramp-up. This customer and shareholder network could serve as a stable raw material sourcing channel.
In addition to its track record recycling NCM and NCA ternary batteries, the company is preparing to commercialize LFP battery recycling with a target of 2026, which could broaden the range of retired batteries it can process. North American expansion is also proceeding through the Georgia MOU and the Indiana plant. This could help diversify a business structure that has been concentrated in Europe and Asia.
The debt ratio rose sharply to 367.6% at end-2025 from 44.4% at end-2022, and operating cash flow stayed negative at KRW -22.8 billion in 2025. This reflects reliance on external funding, including convertible bond issuance, rather than internal cash generation to finance plant expansion and overseas site build-out. With the profit turn only just beginning, balance sheet repair may take further time.
A local court in Batonyterenye, following a suit filed by the municipality, temporarily suspended the environmental impact approval tied to plant expansion. The company and Hungary's energy ministry have appealed but a ruling is still pending, and delayed expansion could affect the pace of European business growth.
Separate from the company's stance that existing plant operations are unaffected, this episode has re-highlighted overseas permitting risk.
Rising cobalt prices have been cited as a key driver of the 2026 earnings improvement, but recent reports indicate cobalt's price rally is reversing as Congo's exports pick up again under the new quota regime.
The earnings improvement that has relied on higher selling prices could be disrupted again if raw material price trends turn. Metal price volatility remains a core swing factor for the company's earnings.
With the debt ratio exceeding 300% and operating cash flow negative for multiple consecutive years, the company may continue to rely on external financing for further expansion or liquidity needs. If the recent profit turn fails to be sustained, financial strain could deepen again.
Overseas sites including Hungary are exposed to country-specific environmental permitting and local government negotiation processes. In Hungary specifically, expansion permitting was temporarily suspended by a court injunction tied to a municipal lawsuit.
With operations spread across multiple countries including India, Malaysia and Poland, risk from country-specific regulatory changes also persists.
The company's earnings are directly affected by prices of battery metals including cobalt, nickel and lithium. Prices have swung sharply in response to Congo's changing export policy, from an outright ban to a quota system and now expanded volumes.
With recent reports pointing to a reversal of the price rally, ongoing monitoring of selling price trends is warranted.
Check whether the Q2 2026 profit turn continued into Q3 and whether Saemangeum Plant No.3 utilization approached 100%.
Watch whether the appeal ruling on the Batonyterenye plant expansion permit resolves the uncertainty around the European expansion timeline.
Monitor Congo's cobalt export quota implementation and international cobalt, nickel and lithium price trends to gauge how the recently reported price reversal affects results.
Check whether the discussed scrap-processing cooperation with Ecopro in Hungary results in a formal agreement, alongside progress on the Indiana and Georgia sites in the United States.
Track the commercialization progress of the LFP battery recycling pilot line to assess whether product portfolio diversification is advancing.
SungEel HiTech saw both consolidated operating profit and owner net profit turn positive in the second quarter of 2026, signaling a possible exit from the loss-making stretch that had persisted since the third quarter of 2023.
This resulted from a combination of rising utilization at Saemangeum Hydro Center No.3 and higher prices for cobalt, nickel and lithium, extending a 2025 trend of simultaneous revenue growth and narrowing losses.
However, with the debt ratio climbing to 367.6% at end-2025 and operating cash flow remaining negative for multiple years, time may be needed before the profit turn spreads into a broader normalization of the balance sheet.
Overseas, expansion permitting at the Hungary plant remains suspended pending a local lawsuit, and recent reports indicate the cobalt price strength that had supported earnings improvement is now reversing as Congo's exports expand.
Brokerages have set 2026 revenue guidance at around KRW 300 billion and repeatedly raised their target prices, but these remain individual broker estimates, with the next Q3 earnings release, the outcome of the Hungary permitting appeal, and raw material price trends likely to be the key variables determining the actual direction ahead.
Report written 2026-09-05 · Data as of 2026-09-04
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