An in-depth analysis of the technological paradigm shift in secondary battery mixing systems and the mid- to long-term corporate value and market competitiveness of Yunsung F&C.

The secondary battery industry, after several years of explosive growth, is currently experiencing a period of temporary stagnation in demand and supply chain restructuring, known as the “Chasm.” Amidst these macroeconomic shifts, stock prices of battery equipment companies are experiencing extreme volatility due to slowing investment in downstream industries and concerns about profitability. In particular, Yunsung F&C, which possesses global leadership in mixing systems—the starting point and quality indicator of the electrode process—has recently experienced a decline in its stock price, raising both concerns and expectations among investors. This report analyzes Yunsung F&C’s operational status, order competitiveness, R&D progress, and financial resilience from various perspectives to assess its mid- to long-term future value over the next three years or more.

Changes in the forward-looking industry and the strategic position of the mixing process

The secondary battery manufacturing process is largely divided into electrode, assembly, and activation processes. The electrode process is a key component, accounting for approximately 30-35% of total equipment investment. The mixing process, the first step in the electrode process, involves precisely mixing the active material, conductive agent, binder, and solvent into a slurry. Because mixing uniformity directly impacts the battery’s energy density, lifespan, and safety, battery manufacturers set very high technological entry barriers when selecting equipment.1

The battery market is currently facing a technological transition: the proliferation of lithium iron phosphate (LFP) batteries, advancements in high-nickel cathode materials, and dry electrode processes. These changes demand from mixing equipment manufacturers not only mechanical assembly capabilities but also the ability to understand the chemical properties of materials and maximize process efficiency. Leveraging over 40 years of mixing technology expertise, Yunsung F&C has proactively responded to these market demands and solidified its market dominance through partnerships with leading domestic and international cell manufacturers.2

Analysis of the causes of stock price declines and market misunderstandings

The recent sluggish stock performance of Yunsung F&C is due to a complex mix of factors. First, battery manufacturers’ operating rates have declined and investment timing has been postponed due to slowing demand for electric vehicles. Major customers, including LG Energy Solution, announced plans to reduce their investments by 20-30% year-on-year in 2025, temporarily dampening equipment manufacturers’ order momentum, which has been reflected in the stock price.3Second, there is a process of normalizing the valuation that had risen since its listing. In 2023, during the overheated secondary battery sector, Yunsung F&C’s PER exceeded 30x. However, it has now fallen to 7x, considered undervalued relative to its earnings, making the stock attractive.4

However, the stock price decline does not necessarily mean a deterioration in the company’s fundamentals. Looking at the 2024 performance, while sales declined slightly year-on-year, operating profit and net profit actually grew, demonstrating a strengthening of the company’s fundamentals.4This suggests that the profitability of previously awarded projects is improving, and that the industry’s sluggishness is being overcome through technological prowess through process efficiency improvements and an increased proportion of high-value-added equipment.

Diagnosing operating efficiency and profitability through financial statements

Yunsung F&C’s recent financial performance has focused on qualitative improvement rather than external growth. Consolidated sales for 2024 amounted to approximately KRW 271.3 billion, a 13.28% decrease from the previous year’s KRW 312.9 billion.4This is interpreted as a temporary decrease in sales recognition due to delayed investment in forward-looking industries. However, operating profit reached KRW 31.9 billion, a 20.55% increase compared to KRW 26.5 billion in 2023.4

Particularly noteworthy in the above data is the sharp decline in the debt ratio and the rise in ROE. The debt ratio, which had risen to 114.60% in 2023, fell to less than half, to 52.53% in 2024. This is the result of the efficient execution of listed funds and the secured cash flow resulting from improved profitability.5Furthermore, the fact that ROE exceeds 20% demonstrates excellent capital efficiency and proves that Yunsung F&C is overcoming the low-margin structure, a chronic problem in the equipment industry, through its technological superiority.5Earnings per share (EPS) in 2024 increased by 51.29% year-on-year to KRW 4,649, showing positive results in terms of enhancing shareholder value.4

Order status and customer diversification strategy

The key to Yunsung F&C’s competitive edge in winning orders is its expansion into the global market, not just its focus on specific clients. The order structure, once heavily reliant on LG Energy Solution, is rapidly diversifying to include new clients in North America and Europe, including SK On.

Strategic partnership with SK On and Blue Oval SK

Yunsung F&C currently holds a unique position as a key supplier of mixing equipment to SK On. The large-scale order from Blue Oval SK, a joint venture between SK On and Ford, provides a solid foundation for Yunsung F&C’s mid- to long-term sales.7SK On is maintaining a 90% share of Korean equipment suppliers in the construction of the Blue Oval SK plant, and Yunsung F&C’s mixing system is at the center of this.8As of the end of 2022, the backlog of orders reached KRW 237.2 billion, and with continued new orders, visible sales growth is expected over the next two to three years.7

Expansion into overseas markets and non-battery sectors

The company’s performance in overseas markets is also impressive. It signed a 31.7 billion won supply contract with NextStar Energy and continues to receive interest from global battery manufacturers in Europe.9Furthermore, beyond batteries, expansion into the pharmaceutical and biotech sectors is becoming increasingly visible. The case of securing a turnkey contract from Daewoong Bio for a 13 billion won biopharmaceutical mixing facility demonstrates that Yunsung F&C’s technology is recognized across the entire precision chemical process.10This is considered an excellent portfolio diversification strategy that can respond to economic volatility in the battery industry.

R&D Innovation: Leading the Next Generation of Mixing Technology

The decisive basis for believing that Yunsung F&C possesses even greater future value than it did three years ago lies in its overwhelming research and development achievements in next-generation process technologies. The company is making world-class progress in the development of continuous mixers and dry process equipment that overcome the limitations of conventional batch mixers.

Mass production of continuous mixers

Continuous mixers are a revolutionary technology that will change the paradigm of the battery manufacturing process. While conventional batch methods involved a step-by-step process of repeatedly mixing and discharging materials, continuous mixers operate continuously, from feed to slurry production. Yunsung F&C’s continuous mixer reduces equipment size to one-fifth of conventional equipment while still achieving high productivity of 35 LPM.11This dramatically reduces manufacturers’ factory site costs and eliminates production setup time, maximizing operational efficiency. With pilot testing completed with major cell manufacturers and mass production lines on the horizon, commercialization is highly likely to lead to a significant increase in market share.12

Dry electrode process and national project implementation

The dry electrode process, a technology that directly presses electrodes in a solid state without using harmful solvents, is considered a key technology for next-generation battery manufacturing, as it reduces energy consumption and eliminates the need for a drying process. Yunsung F&C was selected as the lead agency for the Ministry of Trade, Industry and Energy’s national project, “Development of Continuous Secondary Battery Dry Electrode Compound Mixing Process and Manufacturing Equipment,” and will continue to advance its technology through 2027.1We are developing a quantitative supply and control system for low-emission materials in collaboration with leading institutions such as the Korea Institute of Machinery and Materials and Ulsan National Institute of Science and Technology. This is in line with the trend of internalizing dry processes pursued by global leaders such as Tesla.11

Digital Transformation Strengthens Technological Moats

Beyond simple hardware manufacturing, the company’s evolution toward intelligent process solutions is also noteworthy. The company has developed an in-line quality monitoring system that measures slurry viscosity and solids content in real time, contributing to the realization of “autonomous manufacturing” in the manufacturing process.11Additionally, we utilize a digital twin, a virtual model of the mixer, to enable remote support and process simulation, and provide solutions that minimize equipment downtime through AI-based failure prediction technology.11This software competitiveness is a factor that further widens the technological gap with competitors.

A dramatic expansion of production capacity and infrastructure

In the order-driven industry, production capacity (CAPA) is a critical determinant of sales growth. Yoonsung F&C recently completed construction of a large-scale new factory and R&D center in Anseong, Gyeonggi Province, preparing for the explosive growth in demand ahead.

Anseong Global Mixing R&D Center and New Factory

Completed in June 2024, the Anseong Global Mixing R&D Center boasts a total floor area of ​​10,318 square meters, making it the world’s largest mixing equipment facility.14This center is not simply a research facility; it features actual production-grade pilot facilities, serving as a platform for customers to pre-test and optimize mixing processes utilizing new materials. This serves as a powerful sales tool, strengthening partnerships with customers and increasing the likelihood of equipment orders.14

Currently, the total production capacity of Yunsung F&C is estimated to be secured at approximately 700 billion won in annual sales.15This figure is well over double the 2024 sales target of KRW 271.3 billion, implying that the foundation for rapid growth without bottlenecks has been established when investment in forward-looking industries resumes in the future.

Analysis of strengths and market share compared to competitors

The domestic mixing equipment market is currently dominated by three companies: Yunsung F&C, Jeil M&S, and TSI. Yunsung F&C holds an edge in high-capacity technology and profitability. In a market previously dominated by Japanese equipment, Yunsung F&C pioneered domestic production by developing the first 2,300-liter large-capacity mixer in Korea. Currently, it has commercialized the world’s first 4,000-liter large-capacity mixer, achieving economies of scale.2

In contrast to competitors who have struggled with profitability management and fundraising despite achieving high IPO prices during the listing process, Yunsung F&C has established a virtuous cycle by lowering its debt ratio and securing its own research and development funds based on its solid profit-generating capabilities.5Additionally, maintaining a higher operating profit margin than competitors through joint patent ownership and customized solutions with clients is a key competitive advantage.12

Future outlook and stock valuation

Yunsung F&C’s stock price is experiencing a significant gap between its current performance and future value. As of early January 2026, the stock price is hovering around 29,250 won. However, the securities industry views the company’s fundamentals as solid.5

Performance Outlook for 2025-2026

Starting in 2025, full-scale equipment orders for North American projects that had been delayed are expected. In particular, top-line growth is expected to resume as the large-scale orders recognized since late 2024 are converted into sales. According to market consensus, the projected EPS for 2026 is being revised upward to around KRW 5,005, which equates to a price-to-earnings ratio (PER) of only 5-6x based on the current stock price.5If we apply the average multiple of 12-15x that secondary battery equipment manufacturers received in the past, the stock price is judged to have the potential to rise by at least twice compared to the current level.

Investment Risks and Responses

Of course, there are risk factors. Uncertainty over IRA subsidy policies, stemming from the changing political landscape in the US, including the emergence of the Trump administration, could further delay battery manufacturers’ investments in North America. Furthermore, the accelerated entry of Chinese equipment manufacturers into the global market could exert downward pressure on prices. However, Yunsung F&C already possesses hybrid designs and high-quality LFP mixing equipment that are technologically differentiated from Chinese products. Furthermore, it possesses a strong track record in the North American and European markets, where domestic demand for domestic products is strong, and is expected to maintain its competitive edge.11

Overall Conclusion: Are the Expectations of Three Years Ago Becoming Real?

The “future value and competitiveness” users saw at Yunsung F&C three years ago are now becoming a reality, surpassing mere expectations. Successfully expanding mixing equipment to larger capacities, proactively securing continuous and dry processes, diversifying customer base, and establishing a stable financial structure demonstrate that Yunsung F&C has grown beyond a simple equipment manufacturer into a global battery process solutions provider.

The current stock price slump is largely due to industry-wide sentiment and valuation adjustments, rather than a decline in the company’s intrinsic value. Operating profit is actually growing and the debt ratio is decreasing, indicating the company is operating at its healthiest level since its IPO. Therefore, the current stock price decline can be viewed as an opportunity to acquire quality technology stocks at a discount from a mid- to long-term perspective. News of large-scale production of continuous mixers and announcements of additional orders from North American joint ventures are expected to serve as powerful catalysts for a stock price rebound.

Yunsung F&C is already preparing for next-generation battery manufacturing technology, and its new Anseong plant and R&D center are poised to bear fruit. The insight from three years ago proved correct, and after overcoming the current challenges, Yunsung F&C’s corporate value is highly likely to surpass its previous peak.

Report Summary Data (2024-2026 Forecast)

• Financial securityDebt ratio of 52.53% (2024A), current ratio of 215.11%5

• Profitability: ROE of 20.70%, operating profit growth rate of 20.55% achieved5

• Technology Leadership: Development of the world’s first 4,000L mixer and mass production of continuous mixer on the horizon.2

• Order potential: Completion of annual CAPA of 700 billion won and entry into new businesses such as bio10

• Valuation: Entering the historically undervalued range of 5-6x 12M forward PER5

References

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3. 2024 Annual Earnings Release - Press Release | Media | LG, accessed January 6, 2026.https://www.lg.co.kr/media/release/28612

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9. [Yoonsung F&C Stock Forecast] Expectations for Nexus Star Energy Orders?! 25-Year Plant Operations in the Second Half of the Year, Accessed January 6, 2026https://www.youtube.com/watch?v=ofJPzKM10sc

10. Yoonsung F&C wins order for Daewoong Bio’s mixing and supply equipment… Domestic and international orders rally - Chosun Biz, accessed January 6, 2026https://biz.chosun.com/industry/company/2024/01/10/I3DYEWY5SBAKTB2WY2FTSC2S6Y/

11. Yoon Sung F&C - Mirae Asset Securities, accessed January 6, 2026https://securities.miraeasset.com/bbs/download/2136865.pdf?attachmentId=2136865

12. Yunseong F&C (372170), accessed January 6, 2026https://ssl.pstatic.net/imgstock/upload/research/company/1671150716387.pdf

13. Yunsung F&C selected for national project to develop continuous mixing equipment and processes for secondary battery dry electrodes, a next-generation core mixing technology | Newconomy, accessed January 6, 2026.https://newconomy.co.kr/View.aspx?No=3413641

14. Yunsung F&C Completes Mixing R&D Center, Largest in the World - Chosun Biz, January 6, 2026https://biz.chosun.com/industry/company/2024/06/10/6IDLQPHZKNDXBBAKQ2DNDTR7DE/

15. Battery Equipment (Purchase/Maintain), accessed January 6, 2026http://www.bondweb.co.kr/_research/downloadPage.asp?number=694620&gn=1

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