[Edaily Reporter kyoungeun kim ] Analysts expect Korea Electric Power Corporation ( KEPCO Engineering & Construction(052690)) to see an increase in orders and a valuation re-rating amid growing expectations for its expansion into the U.S. nuclear power market.
If investment in the U.S. nuclear power market materializes, it is projected that the entry of the “Team Korea” nuclear power supply chain—led by KoreaElectricPower (KEPCO) and in collaboration with Westinghouse—into the U.S. market will accelerate.
Lee Sang-heon, an analyst at iM Securities, stated in a report on the 14th, “According to the ‘Memorandum of Understanding (MOU) on Korea-U.S. Strategic Investment’ signed last year following the Korea-U.S. tariff agreement, South Korea plans to invest a total of $350 billion in the U.S., including $150 billion for shipbuilding cooperation and $200 billion in strategic investments,” adding “To this end, South Korea enacted the U.S.-Korea Strategic Investment Act, which took effect last June, and launched the U.S.-Korea Strategic Investment Corporation to oversee its implementation,” he added.
He continued, “As part of these investments in the U.S., plans are being discussed to construct up to eight large-scale nuclear power plants on land owned by the U.S. federal government,” explaining, “While there is speculation that the AP1000 reactor model from Westinghouse Electric Corporation will be used for some of these eight plants, plans to apply the APR1400 design—a Korean-developed reactor—to two of them are also under discussion.”
The researcher continued, “The Trump administration plans to quadruple nuclear power generation capacity from the current level of 100 gigawatts (GW) to 400 GW by 2050 and is pushing to construct 10 new nuclear power plants by 2030,” “However, the U.S. has not built any new nuclear power plants in the past 30 years and has consequently lost its capabilities in equipment manufacturing and nuclear power plant construction,” he pointed out.
He further emphasized, “In contrast, South Korea possesses not only project management capabilities—epitomized by ‘on-time, on-budget’ delivery—and construction expertise, but also a nuclear power supply chain based on its ability to manufacture nuclear power plant equipment; therefore, from the U.S. perspective, cooperation with South Korea is essential.”
Last year, the U.S. government signed an $80 billion nuclear power plant construction partnership with Westinghouse’s major shareholders and others, granting it the right to require a public listing if Westinghouse’s enterprise value exceeds $30 billion and to secure up to a 20% stake. Against this backdrop, plans for the South Korean government and KEPCO to invest in Westinghouse are also being discussed.
The researcher predicted, “If South Korea acquires a stake in Westinghouse, it will not only broaden its foundation for participating in U.S. nuclear power projects but also pave the way for Team Korea—a nuclear power supply chain led by KEPCO—to enter the U.S. market.” Separately, a plan for KEPCO and Westinghouse to jointly establish a joint venture (JV) is also being discussed. Under this model, Westinghouse would handle local U.S. licensing and basic design, while Korea would be responsible for nuclear power plant design, construction, operation, and equipment supply.
The researcher predicted, “Ultimately, if investment in U.S. nuclear power projects materializes, export expansion—including the entry of the ‘Team Korea’ nuclear supply chain, led by KEPCO, into the U.S. market through cooperation with Westinghouse—will accelerate,” adding, “As Team Korea’s trickle-down effects lead to an increase in the company’s order book, its valuation will be re-rated.”
Meanwhile, the analyst noted that as the likelihood of Team Korea securing orders from projects such as the Ninh Thuan 2 nuclear power plant in Vietnam, Saudi Arabia, Units 3 and 4 of the Temelín Nuclear Power Plant in the Czech Republic, and Türkiye increases year by year, the company’s own order wins are also expected to materialize.
The innovative small modular reactor (SMR) project was also cited as a growth driver. The analyst explained, “For the innovative SMR technology development project, the standard design has been completed, and following a three-year verification and licensing process, the goal is to obtain standard design approval for the innovative SMR in 2028,” adding “In this innovative SMR technology development project, the company has carried out 10 tasks—including system design and comprehensive design of balance-of-plant (BOP) equipment—totaling 95 billion won,” he explained. He added, “Above all, the company’s growth potential will become more tangible as it enters the global SMR market based on its domestic commercialization efforts.”