Lotte Chemical CI

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Lotte Chemical Corp. saw a robust start on Thursday after Lotte Group announced plans to place Lotte World Tower as collateral to secure a bank guarantee, aimed at bolstering the chemical unit’s credit.

Shares of Lotte Chemical were trading at 68,100 won ($49) as of 10:48 a.m. on Thursday, up 2.71 percent from the previous session.

On Wednesday, Lotte Group announced a plan to offer Lotte World Tower, the conglomerate’s key asset valued at over 6 trillion won, as collateral to address concerns over Lotte Chemical’s liquidity.

Market observers interpret the move as a strong commitment by the conglomerate to stabilize the chemical arm‘s financial position after recent setbacks.

Last week, Lotte Chemical defaulted on certain financial covenants tied to its corporate bonds, leading to a loss of benefit of time.

Domestic credit rating agencies have cautioned that repeated defaults without a clear self-rescue plan could adversely impact the company’s credit rating.

Meanwhile, EcoPro BM Co. shares also gained on Thursday, following news of its application to transfer to the Kospi from the secondary Kosdaq market.

EcoPro BM stock was trading at 142,100 won as of 10:50 a.m., up 5.1 percent from the previous day.

The Korea Exchange announced on Wednesday that EcoPro BM had submitted a preliminary review application for the transfer.

Founded in 2016, EcoPro BM specializes in manufacturing cathode materials for secondary batteries. Its parent company, EcoPro Co., holds a 45.5 percent stake in EcoPro BM.

Last year, EcoPro BM posted an operating loss of 62.2 billion won on sales of 3.15 trillion won.