By Heekyong Yang and Hyunsu Yim

SEOUL (Reuters) – South Korea’s LG Energy Solution said on Wednesday quarterly profit more than doubled, as the battery maker benefited from subsidies from the U.S. Inflation Reduction Act and solid U.S. sales of electric vehicles.

Its shares jumped as its earnings met forecasts.

The company, which supplies Tesla Inc, General Motors Co and others, said it had received requests from major automaker clients about boosting battery supply since the U.S. law took effect, which could lead to additional orders.

LG Energy Solution (LGES) reported an operating profit of 633 billion won ($472.6 million) for the January-March period, up 145% from 259 billion won a year earlier.

That was in line with an average analyst forecast of 633 billion won compiled by Refinitiv SmartEstimate.

Analysts attributed the jump in profit to solid sales of EVs in the United States, where EV consumers can receive a tax credit of up to $7,500 under the Inflation Reduction Act.

When asked about rival Chinese battery makers’ efforts to enter the U.S. market, LGES Chief Financial Officer Lee Chang-sil said the company would maintain its competitive position in the U.S.

He cited the Inflation Reduction Act, aimed at weaning the United States off dependence on China for EV battery components, as a reason for that advantage.

In a further boost for LGES, U.S. senators want to pass legislation to block tax credits for EV batteries produced using Chinese technology, taking aim at a partnership between Ford Motor Co and Chinese battery maker CATL.

LG Energy Solution’s revenue for the quarter doubled to 8.7 trillion won, LG Energy said in a regulatory filing. Second-quarter sales revenue was likely to hold steady, despite any impact from metal prices, it said.

LGES said revenue in the second half of the year could fall with lower metals input prices as it had signed contracts with customers on “cost pass-through” terms to manage materials costs, however the impact on profitability would be limited.

About 80% of EVs that are eligible for U.S. tax credits use batteries from South Korea’s three major cell makers – LGES, Samsung SDI Co Ltd and SK On, according to an analysis from brokerage Korea Investment & Securities.

Shares of LG Energy Solution (LGES), carved out of LG Chem Ltd last year, rose as much as 2.4% in morning trade, outpacing a flat broader KOSPI market.

($1 = 1,339.3700 won)