[Edaily Reporter PARK MIN ] On the 31st, Shinhan Investment Securities maintained its “Buy” rating and target price of 170,000 won for HyundaiEngineering&Construction(000720), noting that the company is rapidly expanding its global order pipeline based on its unrivaled competitiveness in nuclear power plant construction. This represents an upside potential of 31.9% compared to the previous trading day’s (August 28) closing price of 128,900 won.

Kim Sun-mi, an analyst at Shinhan Investment Securities, stated in a report released that day, “While ‘Team Korea’-based opportunities for nuclear power plant contracts are currently driving momentum across the entire construction sector, once the company’s competitive edge in securing orders is confirmed through actual contracts (with separate contracts set to begin in late Q4), the differentiation in valuation premiums will truly take off.” She added, “We continue to recommend it as our top pick within the construction sector.”

On August 18, HyundaiEngineering&Construction signed a Framework Agreement with U.S.-based TerraPower, securing exclusive construction rights for the Kemmerer Unit 1 EPC (Engineering, Procurement, and Construction) project, as well as for eight additional units scheduled for future construction and joint sales projects.

As a result, HyundaiEngineering&Construction has established a broad nuclear power pipeline that includes: △projects in Bulgaria, five European countries, and the U.S. being pursued with Westinghouse; △three Holtec 3.5-generation small modular reactors (SMRs); △nine TerraPower 4th-generation SMRs; and △projects under the Team Korea framework (such as those in Romania and Vietnam).

The company’s construction technology and cost management capabilities were also cited as key strengths. Shin Hanul Units 3 and 4, currently under construction (approximately 11% complete), are scheduled to reach their peak construction phase in 2027–2028. By expanding the use of modular construction methods and adopting a “Fast Track” approach that integrates design, procurement, and construction, the company has shortened construction schedules and enhanced on-site safety. Analysts note that, given the nature of nuclear power plants—which require strict quality control—the company directly manages both construction sites and subcontractors to minimize variables.

Shinhan Investment Securities also highlighted the high profitability of overseas nuclear power projects. While domestic projects may face limited profitability due to price competition, the firm assessed that overseas projects allow Hyundai Engineering & Construction, as the sole construction partner, to leverage its bargaining power with major design firms, thereby securing relatively higher profitability. The company plans to proactively manage labor issues—a key factor in construction risk—by utilizing local construction firms and existing supply chains.

Shinhan Investment Securities projected HyundaiEngineering&Construction’s 2026 annual revenue at 26.8083 trillion won and operating profit at 914.2 billion won. This represents a 40.0% year-over-year increase in operating profit. The firm further forecast that performance growth would accelerate in 2027, with revenue reaching 28.9943 trillion won and operating profit hitting 1.3646 trillion won.

Analyst Kim Seon-mi stated, “The expected price-to-book ratio (PBR) of 1.6 times for 2026 remains undervalued relative to the company’s potential, which includes its strong earnings growth, unrivaled nuclear power plant order pipeline, and financial competitiveness,” adding, “This is sufficient to justify a corporate value premium.”