[Edaily Reporter KIM YOON-JEONG ] HYUNDAI MOTOR SECURITIES projected that while the prolonged scheduled preventive maintenance (OH) of nuclear power plants will put short-term pressure on KEPCO Plant Service & Engineering(051600)’s earnings, this will be offset by the expansion of domestic and international nuclear power markets. The firm assessed that medium- to long-term revenue growth in the nuclear and pumped-storage sectors is expected as plans for additional nuclear power plant construction within the year take shape and the possibility of securing overseas nuclear power plant contracts continues. It maintained its “Buy” investment rating and target price of 67,000 won.

On the 8th, Shin Dong-hyun, an analyst at HYUNDAI MOTOR SECURITIES, stated, “While the decline in quarterly revenue recognition due to the prolonged nuclear power plant OH will have some impact, overall market expansion—including an increase in reactor restarts and discussions on new nuclear power plants—is expected to offset this.” He added, “We anticipate a rebound in stock prices for companies in the value chain as additional domestic and international nuclear power plant orders and plans are announced in the second half of the year.”
In the short term, the prolonged maintenance of nuclear power plants is weighing on earnings. While discussions regarding the extension of large-scale nuclear plant operations and the construction of new plants—aimed at meeting the increased electricity demand driven by artificial intelligence (AI)—are positive, analysis shows that the prolonged maintenance period led to a decrease in quarterly revenue recognition in the second quarter of this year. Consequently, annual revenue estimates for the nuclear power and pumped-storage sectors have been slightly revised downward.
In the second quarter, operating profit fell short of expectations as administrative expenses—a component of operating costs—rose due to an increase in the hiring of short-term workers.
On the other hand, the upward revision of the domestic electricity demand forecast was cited as a factor raising expectations for additional nuclear power plant construction. Analysts noted that the new forecast for electricity consumption in 2040 was revised upward to reflect major projects—such as the early completion of the Yongin Semiconductor Cluster and the development of a new semiconductor cluster in the Honam region—which has heightened expectations regarding discussions on additional nuclear power plants.
Researcher Shin stated, “The company’s stock price is also expected to react in line with additional nuclear power plant construction plans, which are expected to take shape within the year.”
Overseas nuclear power projects were also identified as a medium- to long-term growth driver. Starting in September of next year, the company will begin deploying personnel in earnest for the modernization project of the aging facilities at the Cernavoda Nuclear Power Plant in Romania, a contract secured last year.
Researcher Shin noted, “The possibility of Team Korea securing additional overseas nuclear power plant contracts in Vietnam, Türkiye, and Saudi Arabia remains open, so revenue from the nuclear and pumped-storage sectors is expected to grow over the medium to long term.”
The 12-month forward earnings per share (EPS) used to calculate the target price was slightly lowered from 3,461 won to 3,434 won to reflect the prolonged OH period and increased operating expenses. The target price-to-earnings ratio (PER) was maintained at 19.23x, which is the upper end of the PER range from 2013 when the company signed the contract for the Barakah nuclear power plant maintenance project in the United Arab Emirates (UAE).