LS Eco Energy said Monday that it will invest approximately 65 billion won through its Vietnamese production subsidiary, LSCV, to build an ultracapacitor (UC) production facility locally.
This investment is aimed at responding to the expansion of orders for UCs used in artificial intelligence data centers by its affiliate, LS Materials. On the 13th, LS Materials signed a supply contract worth approximately $51.5 million (approximately 69 billion won) with a U.S.-based hydrogen fuel cell company. Additional contracts within the year are also under negotiation.
UCs are energy storage devices that rapidly store and supply electricity to compensate for momentary power shortages in hydrogen fuel cell power generation systems. As investment in hydrogen fuel cell power generation equipment expands due to increasing power demand from AI data centers, UC demand is also expected to grow.
LS Eco Energy plans to contract manufacture (OEM) UCs based on LS Materials' technology. LSCV will begin supply with Yangsan next April and aims to achieve annual sales of approximately 150 billion won by 2030.
LS Materials plans to diversify its production bases between South Korea and Vietnam to respond to expanding global demand. LS Eco Energy is expected to secure a new revenue base through high-value-added new businesses. The company also intends to consider follow-up investments depending on future additional orders.
LSCV is evaluated as a production base with high cost competitiveness, as it can utilize idle land within its existing factory and benefits from relatively low labor and utility costs. The UC business is expected to yield higher profitability than the existing general-purpose wire business, contributing to an improvement in LS Eco Energy's profit margin.
Lee Sang-ho, CEO of LS Eco Energy, stated, "We will cultivate UCs as a new growth engine and expand our business scope into high-value-added products for AI data centers, such as bus ducts."
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