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Emerging as a key Cybercab beneficiary

Raise TP to W79,000

We raise our target price for Chunbo by 16% to W79,000 (from W68,000), reflecting an 11% upward revision to our 2027F EBITDA. Our target EV/EBITDA remains 15x. Notably, the fluorinated electrolyte (F-electrolyte) salt lines that began production and shipments earlier this year are ultimately linked to the Cybercab program of a North American OEM (supplied for its in-house 4680 cell production). Despite the initial depreciation burden associated with the ramp-up of this capacity, we expect F-electrolyte product shipments to contribute meaningfully to earnings on an EBITDA basis. In addition, from 2H26, ASP increases driven by rising raw material prices (e.g., lithium) are likely to take hold, supporting meaningful spread improvement. All in all, we expect 2027 EBITDA to surpass the levels seen during the 2021-22 industry up-cycle.

One of only a small handful of Cybercab beneficiaries

We believe full-scale F-electrolyte shipments have begun via two global electrolyte producers, with a North American OEM being the end-customer. The end-application is believed to be the OEM’s Cybercab (in-house 4680 cells). While further clarity is needed on the pace of Cybercab/4680 cell mass production and actual demand following launch, we expect F-electrolyte products to become a key driver of fundamentals and valuation, given: 1) the Cybercab’s stronger medium/long-term demand visibility relative to other EV models; and 2) the relatively limited pool of Cybercab beneficiaries in the global EV battery value chain.

We expect F-electrolyte product revenue to increase sharply starting in 2026 (from W1bn in 2025 to W50bn in 2026 and W105bn in 2027). Accordingly, the share of F-electrolyte products within Chunbo’s battery materials revenue should rise from 2% in 2025 to 36% in 2026 and 46% in 2027, driving overall earnings growth.

ASP increases in 2H26 to support earnings recovery

Near-term operating profit is likely to come under pressure, given the depreciation expenses associated with the start-up of new F-electrolyte product lines. That said, the firm should see meaningful improvement on an EBITDA basis. We expect 2027 EBITDA to surpass the levels seen during the 2021-22 industry up-cycle.

Of note, we expect ASPs for existing products to rise by around 20% in 2H26. Higher key raw material prices are normally reflected in ASPs with a time lag, leading to wider spreads. Additionally, the electronic materials segment―where favorable conditions (i.e., semiconductor up-cycle) persist and margins remain high (around 20%)―should also support an overall earnings recovery.