[Edaily Reporter Shin Ha-yeon ] On the 7th, NH INVESTMENT & SECURITIES upgraded its investment rating for Doosan Fuel Cell(336260)from “Hold” to “Buy,” citing the company’s confirmed medium- to long-term growth potential following a large-scale fuel cell supply contract for U.S. data centers. The firm also raised its target price by 70.6%, from 34,000 won to 58,000 won.

Jeong Yeon-seung, an analyst at NH INVESTMENT & SECURITIES, stated, “This upgrade reflects a 32% upward revision to our 2027 revenue estimate to account for the fuel cell order for the U.S. market,” adding, “The target price was calculated by applying an average 2027 EV/Sales multiple of 6.0x for global fuel cell peer companies.”

Doosan Fuel Cell secured an order worth 501.4 billion won to supply phosphoric acid fuel cells (PAFCs) through its U.S. affiliate, HyAxiom. While the end customer has not been disclosed, the cells are reportedly destined for data centers in the United States.

This order is considered to be larger than initially expected. While the unit price for the recent YH Power Projects 1 and 2 in South Korea was approximately 3.2 billion won per MW, the unit price for the U.S. supply is estimated to be higher. Based on this, NH INVESTMENT & SECURITIES estimated the order size at approximately 140 MW—significantly exceeding the initially projected 50 MW.

Researcher Jeong explained, “Considering the scale of the supply, we believe it is highly likely that the fuel cells supplied this time will be used as the primary power source for the data centers, rather than as a backup power source.”

In particular, analysts note that this order confirms that even PAFCs, which have relatively low power generation efficiency, can secure a competitive edge in the U.S. data center market.

Researcher Jeong assessed, “This order confirms that even PAFCs, which have relatively low power generation efficiency, can enter the U.S. data center market based on strong demand for on-site power generation.”

He continued, “Although the timing was later than expected, the success in securing this large-scale order has significantly increased the likelihood that Doosan Fuel Cell will establish itself as a meaningful supplier in the U.S. data center fuel cell market based on PAFC technology, following Bloom Energy’s SOFCs and FuelCell Energy’s MCFCs (molten carbonate fuel cells).”

The analyst also noted that there is ample capacity for additional orders. Doosan Fuel Cell’s current annual production capacity stands at 275 MW for PAFCs and 50 MW for SOFCs. As the company is currently expanding its production line by one additional PAFC line, its future production capacity is expected to increase to 350 MW annually.

Analyst Jeong explained, “Even assuming annual PAFC production of approximately 100 MW for the domestic market and 100–120 MW for the U.S. market, the company’s production capacity allows it to handle additional orders of over 100 MW per year,” adding, “This is why we expect additional orders for U.S. data centers in the future.”

Earnings are projected to enter a phase of full-scale improvement starting in 2027. NH INVESTMENT & SECURITIES raised its 2027 revenue forecast for Doosan Fuel Cell from the previous 668.9 billion won to 882.1 billion won, a 31.9% increase. This represents an 80.5% increase compared to this year’s projected revenue of 488.8 billion won. The firm forecasts that the company will return to profitability in 2027 with an operating profit of 40.4 billion won.

The firm anticipates that financial pressures will persist through this year. It estimates this year’s revenue at 488.8 billion won and an operating loss of 94.1 billion won. This is attributed to costs related to the quality of fuel cell stacks supplied in the past, low capacity utilization rates, and delays in securing orders beyond initial expectations. The firm also expects the burden of debt to increase as working capital rises.

However, Analyst Jeong predicted, “Once delivery volumes begin to increase in earnest starting in 2027, the operating capital burden is expected to gradually ease alongside rising capacity utilization rates.”

Another positive factor is that, in the U.S. data center power market, supply capacity itself is becoming more important than the competitive landscape among fuel cell technologies. Analyst Jeong emphasized, “As power demand from data centers in the U.S. is growing rapidly, supply potential and installation speed are becoming more important than the specific characteristics of each fuel cell technology. Accordingly, we believe the market has entered a phase where orders are expanding across the board, regardless of technology type—such as SOFC, MCFC, or PAFC.”