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(Bloomberg) — SungEel HiTech Co., a South Korean battery recycling company, plans to sell shares on the country’s tech-heavy Kosdaq bourse later this year as it targets revenue of around $1 billion and a 10% global market share by 2030.

The recycler is aiming to raise about 140 billion won ($110 million), according to a person familiar with the matter. A representative at the company declined to comment.

SungEel swung to an operating profit of 16.8 billion won last year with a margin of about 11.4%, Chief Executive Officer Yi Kang-myung said in an interview. Sales for 2021 came in at around 147 billion won.

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Founded in 2000, SungEel specializes in recycling lithium-ion batteries. It collects old and defective cells from automakers and some of the country’s biggest battery makers, including LG Energy Solution, and has the capacity to extract about 4,400 metric tons of nickel and cobalt annually.

Recycling is critical for countries’ net-zero goals because it helps lower prices of the metals used in batteries, the most expensive part of an electric car. Proceeds from any initial public offering would help SungEel achieve its target of handling around one million spent cells by 2030, up from 100,000 currently, Yi said.

“With battery-related stocks trading at high valuations, investors will have high expectations for the firm even after an IPO,” said Han Seung-Jae, an analyst at DB Financial Investment Co. “SungEel HiTech is the only battery recycler in Korea that’s making a profit and it has close relations with local battery makers.”

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The company already has nine recycling plants around the world — three in South Korea and the rest in China, India and eastern Europe. With container lines and other transport operators reluctant to carry second-hand batteries for safety reasons, Yi said it’s better to build the facilities near to where the batteries are sourced.

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According to BloombergNEF, approximately two million metric tons of lithium-ion battery scrap will be available for recycling every year by 2030. South Korea is home to three of the world’s top 10 battery makers: LG Energy, SK On Co. and Samsung SDI Co.

Battery recycling’s growth prospects as consumers embrace electric cars and nations and automakers commit to phasing out combustion engines has seen companies wade into the sector. Redwood Materials Inc. was created by Tesla Inc. co-founder J.B. Straubel and is one of the biggest lithium-ion battery recyclers in the U.S. Li-Cycle Holdings Corp. listed in August and already has a market value north of $1 billion.

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One early backer of SungEel is Samsung C&T Corp., a unit of Samsung Group that held a 6.3% stake in the company as of December, company filings show. With proceeds from an IPO, Yi plans to build a new plant in Gunsan in Korea that will help increase output to 10,000 tons of cobalt and nickel and 7,000 tons of lithium carbonate.

Yi, a graduate of metals engineering at the prestigious Korea University in Seoul, initially founded SungEel as a recycler of various other metals. Until the mid-2000s, it extracted silver from second-hand televisions.

Battery recycling, however, is a labor intensive and sometimes dangerous process. Explosions, combustion and poisonous gases released in the recovery process can cause casualties and batteries need to be fully discharged before the recycling starts.

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That process can be divided into two stages — the physical, which includes disassembly, crushing, screening, magnetic separation, washing and heating, and the chemical, which involves pyrometallurgical and hydrometallurgical processes. One measure of a battery recycler’s success is the production of “black mass” — a powdery substance that contains a variety of metals, including lithium, cobalt and nickel.

Companies like SungEel need to work on automating more stages of the recycling process, according to Chul-Wan Park, a professor at Seojeong College who specializes in the auto industry. That will also cut down on the sheer factory space needed, he said. 

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