Epoxy-insulated bus duct facility construction and mass production on track

Bus duct annual sales seen expanding to 100 billion won

Samarium annual production capacity of 240 tons under development

Rare-earth metals business targets 450 billion won in sales by 2030

An exterior view of LS Eco Energy's Vietnam production subsidiary, LSCV. [LS Eco Energy]
An exterior view of LS Eco Energy's Vietnam production subsidiary, LSCV. [LS Eco Energy]

LS Eco Energy is stepping up its push to secure new growth engines by advancing its bus duct business for AI data centers while moving into rare-earth metals in earnest. The company plans to meet surging power infrastructure demand from AI data centers while also entering the high-performance permanent magnet materials market serving physical AI, mobility and other sectors.

According to industry sources, LS Eco Energy disclosed at a recent IR that it plans to shift its existing bus duct business toward high-spec products for AI data centers. Bus ducts are power-distribution systems used inside buildings, factories and data centers. The company intends to upgrade from low-voltage industrial and general large-scale data center products to medium-voltage products designed for AI data centers.

The move is aimed at keeping pace with increasingly demanding power supply requirements driven by rising electricity consumption at AI data centers. To that end, the company is pursuing production of medium-voltage products using epoxy-type insulators. LS Eco Energy had earlier announced an investment of about 8 billion won ($5.93 million) in its Ho Chi Minh City-based Vietnam production subsidiary, LSCV, to build an epoxy-insulated bus duct manufacturing facility. The IR also provided a more specific mass production target: October next year.

The company's bus duct business currently generates annual sales of roughly 30 billion to 40 billion won, but expanding production capacity toward AI data center products is expected to push that figure to between 80 billion and 100 billion won a year. The operating profit margin is also projected to rise to around 15 percent. The company plans to focus initially on Southeast Asian markets including Vietnam, Indonesia, Malaysia and Thailand, with India on the horizon. A longer-term option of entering the US market in cooperation with group affiliates has also been raised.

The IR also outlined plans for rare-earth metals, another new business line. LS Eco Energy is working to build a non-China rare-earth supply chain by sourcing raw materials from Australian rare-earth supplier Lynas, processing them into metals, and feeding the output into LS Cable & System's permanent magnet business.

The rare-earth metals business is expected to benefit significantly from the growth of the AI industry. High-performance motors used in physical AI, mobility and renewable energy applications rely on permanent magnets as a core component. Manufacturing permanent magnets requires rare-earth inputs such as neodymium and praseodymium (Nd·Pr), while dysprosium and terbium (Dy·Tb) are used as additives. Samarium (Sm) serves as the raw material for permanent magnets used in defense and aerospace applications.

LS Eco Energy will begin with the samarium metals business, having disclosed a plan to invest in a joint venture on Sept. 30. The company aims to begin pilot production of 30 tons by the end of this year and build out annual production capacity of 240 tons by 2027. Strong demand from the US Department of Defense is said to be a key driver behind the decision to prioritize samarium.

The company will then expand into Nd·Pr and Dy·Tb, targeting the high-performance motor market for physical AI, mobility and renewable energy. That metals business is planned through a separate entity from the samarium production subsidiary. Mass production targets for 2028 stand at 2,000 tons per year for Nd·Pr and 60 tons per year for Dy·Tb. LS Eco Energy has set a goal of achieving total rare-earth metals sales of 450 billion won by 2030.


keg@heraldcorp.com