South Korean conglomerate LG will invest 10 trillion won (about $8.7 billion) in its battery and other eco-friendly materials business by 2025.
LG Chem, the checmical company of the conglomerate, has selected eco-friendly sustainable business, e-mobility centering on battery materials and global innovative new drugs as the three major new growth engines, the company's CEO Hak Cheol Shin said at a press conference, adding that LG Chem will invest 10 trillion won by 2025.
"The standard for measuring competitiveness in the business world should be based on sustainability for revenue and operating profits, and this should be reflected in all business processes, strategy, and investment, etc...From this perspective, our business portfolio will be overhauled toward being based on ESG, while pursuing sustainable growth," Shin said.
LG Chem plans to invest 6 trillion won for battery materials and to build a wide portfolio ranging of anode materials, separation membranes, cathode binders, among others.
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The company will commence construction of a 60,000-ton capacity plant in South Korea for anode material business in December. "Through this, the anode production capacity of LG Chem will increase by roughly seven-fold from 40,000 tons in 2020 to 260,000 tons by 2026," it said.
The company's move to gain a greater wider share in the battery business comes at a time when adoption of electric vehicles is increasing across the world, and the demand for batteries is likely to see a multi-fold increase in the coming decades.
LG Chem is in the process of forming a joint venture with a mining company for stable supply of metals that will be used as raw materials for anode materials. "LG Chem will actively pursue cooperation in various ways with companies possessing mining, smelting and refining technologies to strengthen its metal sourcing competitiveness," it said in a release.
For products such as anode materials, cathode binders, and radiant adhesives, LG Chem plans to focus R&D resources to differentiate its technologies and acquire market leadership.
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"This is because in the battery materials market that is expected to grow quickly from 39 trillion wons in 2021 to 100 trillion wons by 2026, it is anticipated that demands for material innovation will strengthen for the sake of improving performance and cutting costs," it said.
Besides, LG Chem also plans to invest 3 trillion wons in sustainable businesses such as bio materials, recycled materials, and renewable energy industry materials to build a platform for the future growth of the petrochemicals company.
The company will also "actively" look for new business opportunities in renewable energy industry materials market such as POE/EVA (Polyolefin Elastomer/Ethylene Vinyl Acetate) for solar power panels.
"As the generation cost for renewable energy such as solar power and wind power are becoming less expensive than fossil fuels in the US and China, renewable energy markets are growing rapidly," it said.
The remaining 1 trillion wons will be invested in new drug business with the goal of becoming a global new drug company holding two or more new innovative drugs by 2030 to enter advanced markets such as the US and Europe, it said.
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