"Doosan Enerbility Sees Policy Momentum Through November... Expanding Nuclear and SMR Orders" [Click e-Stock]

On August 27, NH Investment & Securities evaluated that domestic and international policy momentum for Doosan Enerbility will continue until just before the US midterm elections in November. The firm maintained its target price at 1,330,000 won and its "Buy" investment rating.

Minjae Lee, an analyst at NH Investment & Securities, stated in a report released on this day, "Momentum is expected to be further strengthened by events such as the high-level Korea-US nuclear agreement meeting, the announcement of the first investment in the US, the draft of the 12th Basic Plan for Electricity Supply and Demand, and the nuclear cooperation talks between the US and Saudi Arabia." He added, "Based on its unrivaled position in both the large-scale nuclear and small modular reactor (SMR) markets, significant expansion in order intake is expected to begin in earnest from next year."

The trend of expanding demand in the end markets continues. Lee said, "In addition to the federal government's push for large-scale nuclear plants in the US, discussions on SMR adoption by state governments and private companies are gaining traction." He added, "In Korea as well, discussions on expanding nuclear plants have begun due to mid- to long-term electricity demand resulting from mega projects."

Valuation attractiveness compared to global competitors is also a positive factor. Lee stated, "The average enterprise value to EBITDA (EV/EBITDA) for the gas turbine divisions of global competitors, based on expected 2030 figures, is around 18 times, which is higher than Doosan Enerbility." He elaborated, "More than half (50 GW) of the large-scale nuclear and SMR pipeline orders Doosan Enerbility could secure by 2030 are in North America, and the proportion of gas turbines is also expected to be high in that region, raising expectations for future revaluation."

Lee noted, "Since US companies lack adequate construction and manufacturing capabilities on their own, collaboration with the value chain led by Doosan Enerbility and domestic construction firms is essential." He projected, "By 2030, the company will achieve cumulative new orders worth 51 trillion won for large-scale nuclear plants and 31 trillion won for SMRs."

This content was produced with the assistance of AI translation services.