[Edaily Reporter Kim Kyung-eun] Daishin Securities has issued a new “Buy” rating and a target price of 39,000 won for #GS Construction, citing high expectations for its core business and overseas orders. The analysis suggests a 28.9% upside potential compared to the current price of 30,250 won.
Lee Hye-jin, an analyst at Daishin Securities, stated in a report on the 16th, “In addition to the normalization of earnings in the core domestic housing business, expectations for overseas orders serve as an additional catalyst.”
The target price was calculated by applying a target price-to-book ratio (Target PBR) of 0.65 to the 12-month forward book value per share (BPS) of 60,122 won.
The analyst stated, “About 60% of revenue comes from the construction and housing sectors,” adding, “While top-line growth has slowed due to a decline in new construction starts since 2023, profitability is improving as high-cost projects are completed.” She further projected, “A recovery in earnings is expected in the second half of the year, driven by an improved housing mix, revenue recognition from new construction sites, and the full-scale contribution of data center revenue.”
The analyst noted, “The company has a track record of constructing domestic nuclear power plants, including Shin-Wolseong Units 1 and 2 and Shin-Hanul Units 1 and 2,” and analyzed, “Team Korea is expected to participate in nuclear power projects in Vietnam and Saudi Arabia, and it possesses competitive bidding capabilities based on over 20 years of accumulated experience and local networks in Vietnam.”
Regarding reconstruction projects in the Middle East, he explained, “The company has a track record of construction projects across the entire Middle East,” adding, “It has a history of securing contracts through direct negotiations as the original contractor for the 2017 fire restoration project in Ruwais, UAE.” He added, “We expect a high likelihood of securing future contracts for Middle East reconstruction projects based on its status as the original contractor.”
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