South Korean DE&T will open new subsidiaries in the United States and Canada

Recently, DE&T, a South Korean manufacturer of secondary batteries and display laser equipment, announced that the company will further expand its overseas business by opening new subsidiaries in the United States and Canada. According to its claim, this move is to carry out maintenance services for laser equipment locally. As of now, DE&T's overseas subsidiaries have increased from two to four.

DE&T established two overseas subsidiaries, DE&T MICHIGAN INC and DE&T CANADA LTD, as early as the fourth quarter of 2024. But in fact, DE&T already has a subsidiary DE&T US INC in Ohio, USA, and the subsidiary established in the United States this time is located in Michigan.

DE&T originated from the LCD department established within Mirae Industry in 1994. In 2001, the department officially became an independent DE&T company, focusing on the localization of LCD GLASS testing equipment in its old line. Its main business is the production of testing equipment for manufacturing liquid crystal displays (LCDs) and plasma display panels (PDPs). But by the end of 2018, it entered the secondary battery business by supplying mass production equipment to LG Energy Solution's soft pack battery trial production line. At the end of 2018, the consolidated accounting sales amounted to approximately KRW 75 billion.

It is understood that DE&T produces laser slotting equipment for secondary battery cathodes and anodes at its Wushan factory in South Korea, and supplies these devices to a joint venture established with LG Energy Solution. Industry insiders have analyzed that the establishment of a new subsidiary in the United States is mainly to provide maintenance support for equipment supplied to LG Energy Solution and General Motors' joint venture in Michigan.

In addition, DE&T has also established a local subsidiary PT in Indonesia DENT ENERGY INDONESIA。 The establishment of this Indonesian subsidiary is also in response to LG Energy Solution and Hyundai's factories in Indonesia.

The expansion of DE&T's local subsidiary is to meet the maintenance needs of customers when expanding overseas and selling more equipment. The expansion of overseas subsidiaries means that the growth of sales is based on this. Of course, compared to device sales volume, sales revenue is not significant, but providing continuous service to customers and maintaining business relationships is also meaningful.

In 2024, DE&T received a total of KRW 87.4 billion order for laser slotting equipment from L-H Battery Company Incorporated, a joint venture between LG Energy Solutions and Japanese automaker Honda.

Due to the growth of overseas sales, DE&T's comprehensive revenue last year was approximately KRW 146.4 billion, a year-on-year increase of 15%. The operating profit has more than doubled compared to the previous year, reaching 5.4 billion Korean won. The company attributes its growth to the continuous growth of the laser slotting equipment market.

So far, DE&T has only provided laser slotting equipment for soft pack battery production lines, but it is also developing laser slotting equipment for square and cylindrical batteries. In the long run, the company's goal is to become a manufacturer of laser slotting equipment that covers all three forms of batteries, achieving external growth. In addition, DE&T will also expand production capacity, and the company is currently looking for new production bases.

According to insiders at DE&T, based on this year's business report, the company currently has a backlog of 106.3 billion Korean won in orders. Therefore, even if battery manufacturers do not carry out large-scale production expansion this year, it is expected that additional production line expansion will be carried out.

Although DE&T's transformation path has been affected by the cyclical fluctuations in the display industry, the company's performance has significantly improved with the widespread application of secondary battery laser equipment in the North American market. In 2023, DE&T's sales increased by 19% year-on-year, reaching 127.3 billion Korean won, and its operating profit turned from loss to profit, reaching 1.7 billion Korean won, with a net profit of as high as 1 billion Korean won. The performance in the first quarter of this year also maintained a good momentum, with sales increasing by 4% year-on-year to 43.1 billion Korean won, and significant growth in operating profit and net profit.

Since 2022, DE&T has been expanding its business scope from display detection equipment to secondary battery laser equipment. Now, in terms of overall performance, this transformation has begun to show results. With battery manufacturers placing orders in the fourth quarter of last year, DE&T's backlog of orders has reached approximately 90 billion Korean won.

Source: Yangtze River Delta Laser Alliance