[Edaily Reporter PARK MIN ] Daol Investment & Securities announced on the 5th that it is maintaining a target price of 24,000 won and a “Buy (BUY)” investment rating for DaewooEngineering&Construction(047040), citing an earnings surprise and an upward revision to its order intake guidance.

Park Young-do, an analyst at Daol Investment & Securities, stated in a report released that day, “DaewooEngineering&Construction’s second-quarter revenue was 2.0435 trillion won, exceeding our estimate and the consensus by 8.4% and 0.3%, respectively,” adding, “Operating profit was 232.3 billion won, exceeding our estimate and the consensus by 94.5% and 45.2%, respectively.”

The analysis confirmed an improvement in the housing segment’s profit margin; while there were some cost adjustments in the civil engineering and plant segments, the improvement in housing profits offset these effects. Analyst Park said, “Even considering the one-time impact of approximately 90 billion won from contract price increases and other factors reflected in the second-quarter results, the mid-double-digit revenue profit margin is expected to continue,” adding, “The trend of profit improvement will persist in tandem with revenue growth.”

Analyst Park noted, “First-half order intake reached 7.1 trillion won, achieving 39.6% of the previous guidance (18 trillion won), and the company has set its new order guidance at 27 trillion won,” “This suggests that orders for major projects—such as the Dukovany Nuclear Power Plant in the Czech Republic, the Papua New Guinea LNG project, the Nigeria fertilizer project, the Mozambique LNG project, and the Gadeokdo New Airport—are imminent.”

He continued, “As long as no significant bad debt events occur, we expect the substantial improvement in operating profit seen in the previous quarter to continue.” He added, “While we are making conservative estimates for revenue and profit growth in the second half due to ongoing earnings volatility, there is room to revise our estimates upward if no receivables risks materialize and we meet our order intake guidance.”