Japanese electronics components maker TDK has seen its share price increase more than 40 per cent this year alone, far exceeding the 13 per cent rise by the Nikkei Stock Average.

Driving that surge in the company’s valuation is its potential as a battery supplier for AI-equipped devices as well as last month’s big announcement that it had managed to develop a material for solid-state batteries with 100 times higher energy density compared to its conventional solid-state batteries.

TDK said that it had successfully developed the material for CeraCharge, a next-generation solid-state battery that will reportedly offer an energy density of 1,000 Wh/L.

That success, it says, was possible due to the use of oxide-based solid electrolyte and lithium alloy anodes.

It added that the use of oxide-based solid electrolytes is something that makes the new batteries “extremely safe” and that it would be fit for devices that come in direct contact with the body.

TDK has developed a new material for solid-state batteries (Image: Sourced from TDK website)

TDK has developed a new material for solid-state batteries (Image: Sourced from TDK website)

As for mobile phones, TDK reportedly holds around 40 per cent of the global market in lithium-ion batteries for mobile phones. TDK’s consolidated net profit for the fiscal year ended March climbed 9 per cent to 124.6 billion yen (A$1.23 billion) even as its rivals’ profits dipped.

However, some analysts have sounded a degree of restraint in the market’s buoyant outlook for the impact that TDK’s recent battery tech reveal will have on its numbers in the immediate future. “Mass production is several years away, and technologically speaking it’s not for personal computers or smartphones, but for small wearables,” Nikkei Asia reported Goldman Sachs analyst Daiki Takayama as having said. “It’s too early [to] factor the impact into earnings or the stock price.”

Takayama predicts that growth in the medium-long term will come by way of TDK’s attempt to build more energy-efficient batteries. Those batteries will become crucial to use in devices such as smartphones and computers running AI applications.

TDK is believed to be developing batteries with silicon electrodes that can improve energy density by up to 40 per cent.

According to data by global researching firm, Counterpoint Technology Market Research, the share of GenAI-equipped smartphone shipments to overall smartphone shipments will reach 11 per cent by 2024 and 43 per cent by 2027 to pass 550 million units in 2027, a nearly 4X growth. The GenAI smartphone installed base to cross 1 billion by 2027.

Takayama noted that Edge AI – the deployment of AI in end-user devices – will result in a “need for the energy-dense batteries that are a speciality of TDK.”