[Edaily Reporter PARK MIN ] On the 30th, NH INVESTMENT & SECURITIES analyzed that while TaihanElectricWire(001440)’s third-quarter earnings slowed somewhat due to external headwinds such as the falling won-dollar exchange rate and geopolitical risks in the Middle East, the company is expected to return to steep growth starting in 2027 thanks to expanded investment in domestic and international power grids.

However, reflecting the rise in the cost of equity due to interest rate hikes and the outlook for a decline in the exchange rate and raw material prices, the firm lowered its 12-month target price by 20.8% from the previous 48,000 won to 38,000 won. Based on the previous day’s closing price (20,500 won), the stock has an upside potential of 85.4%.

In a report published today, Lee Min-jae, an analyst at NH INVESTMENT & SECURITIES, stated, “Taihan Cable & Solution’s third-quarter consolidated revenue rose 37.6% year-over-year to 1.176 trillion won, while operating profit increased 4.5% to 30.9 billion won (operating margin of 2.6%), falling short of market expectations.” The reasons cited for the weak short-term performance included shipping delays caused by the Middle East conflict, a decline in the won-dollar exchange rate, and rising ocean freight rates.

However, the analyst explained, “Sales of high-margin extra-high-voltage (EHV) cables rose 37% year-over-year to 240.3 billion won, continuing the growth trend seen in the first half of the year,” adding, “High-margin projects secured since 2024 are now being fully reflected in revenue.”

Order intake indicators showed a solid upward trend. New orders in the third quarter totaled 800 billion won, an 11% increase from the previous quarter, while the total order backlog rose 6% quarter-over-quarter to 4.3 trillion won. This is the result of securing a series of major projects in key global regions, including ultra-high-voltage cables in North America (120 billion won), 380 kV-class cables in Germany (115 billion won), and a data center project in Australia (45 billion won).

NH INVESTMENT & SECURITIES forecasts that the global wire and cable market will enter a second growth phase starting in 2027. This is because utilities in the U.S. and Europe are ramping up investments in the undergrounding of high-voltage (HV) transmission lines to alleviate power loads from artificial intelligence (AI) data centers and replace aging power grids.

The analyst noted, “Given the limited capacity to expand the global wire supply chain, the order backlog is expected to rise sharply starting next year as major global projects are added,” adding, “In particular, the North American market, which is rapidly expanding its investment in undergrounding, presents a very favorable environment for domestic wire manufacturers.”

A trickle-down effect from domestic power infrastructure policies is also expected. This is because the “West Coast Energy Highway” (Ultra-High Voltage Direct Current Transmission, or HVDC, project)—which the government is promoting to achieve carbon neutrality and ensure power supply for national mega-projects—will begin in earnest next year.

The analyst added, “We plan to proactively address demand for the West Coast subsea power grid through the completion of the Dangjin Subsea Cable Plant No. 2 and the acquisition of an additional dedicated cable-laying vessel (CLV),” noting, “Although we have lowered the target price due to the impact of short-term macroeconomic variables, the medium- to long-term trend of earnings improvement, driven by global ultra-high-voltage and subsea cable businesses, remains robust.”