[Edaily Reporter PARK MIN ] On the 10th, Yuanta Securities Korea issued a new “Buy (BUY)” investment rating and a target price of 47,000 won for KoreaElectricPower(015760), noting that despite short-term earnings pressures, long-term growth prospects are becoming increasingly clear.

Son Hyun-jung, an analyst at Yuanta Securities Korea, stated in a report published that day, “While short-term profit expectations have declined, the long-term power demand outlook has been significantly revised upward due to the 12th Basic Plan for Power Supply and Demand, which reflects demand for artificial intelligence (AI) data centers and semiconductors.” She added, “Consequently, the likelihood that the roles of transmission and distribution networks and nuclear power plants will expand has increased, and structural changes have begun.”

Yuanta Securities Korea forecast that KoreaElectricPower’s short-term earnings would be somewhat challenging. With the System Marginal Price (SMP) rising rapidly in the third quarter while electricity rates remained frozen, third-quarter operating profit is estimated to be 1.8753 trillion won, a 66.8% decrease from the same period last year. Full-year operating profit for this year is expected to fall 50.7% year-over-year to 6.6501 trillion won, and operating profit in 2027 is projected to remain at around 6.9416 trillion won.

Nevertheless, the firm identified two key investment themes from a long-term perspective: “nuclear power” and “the power grid (Grid).” The stable operation of existing nuclear power plants reduces reliance on liquefied natural gas (LNG) and externally purchased electricity, thereby helping to cushion the impact of rising procurement costs.

The potential for securing contracts for additional domestic nuclear power plants and new overseas projects represents a potential upside factor not currently reflected in the company’s earnings or target price. Furthermore, as large-scale investments in transmission and substation facilities continue over the long term due to the expansion of the AI and semiconductor industries, the growth potential of KoreaElectricPower(015760) ’s grid assets is also increasing.

Yuanta Securities Korea assessed that the newly proposed target price of 47,000 won is a conservative level that does not aggressively factor in long-term growth expectations. The firm explained that it excluded the value of additional nuclear power plants under the 12th Basic Plan for Electricity and new overseas nuclear power plant projects, and that the valuation of grid investments was also calculated on the premise of future confirmation of investment recovery.

Analyst Son Hyun-jung stated, “The key issue is whether the increased investment assets can be recovered as actual cash and profits,” adding, “While the debt burden resulting from large-scale grid investments will continue for the time being, there are signs of diversification in investment funding sources—such as government capital injections, fiscal support for policy-related costs, and advance payment of electricity bills. As the visibility of investment cost recovery improves, long-term asset growth will lead to enhanced shareholder value.”