MERITZ Securities reported on the 31st that Hyundai E&C clearly stated its plan to reorganize its business portfolio focused on nuclear power by 2030 during its 'CEO Investor Day.'
According to research analyst Mun Kyung-won at MERITZ Securities, Hyundai E&C limited its mentions of 'dwellings' to 12 during the CEO Investor Day held on the 28th. In contrast, terms like nuclear power, small modular reactors (SMR), and nuclear were mentioned a total of 113 times during the presentation. Energy was used 44 times.
Hyundai E&C presented a blueprint to grow its energy business centered on large nuclear power plants and SMRs, aiming to increase its profit contribution from 5% this year to 24% by 2030. Starting with the EPC contract for a large nuclear power plant in Bulgaria and the Pelican SMR contract in the U.S. by the end of 2025, the goal is to secure contracts in Sweden, Saudi Arabia, Kazakhstan, the United Arab Emirates, Slovenia, South Africa, and Turkey.
Analyst Mun said, "Hyundai E&C is securing construction rights through partnerships with U.S. companies such as Korea Hydro & Nuclear Power, Westinghouse, and Holtec, which holds significant potential for growth in the size of the energy business," adding, "The issue is whether it can secure sufficient profitability amid various crisis factors, such as the long construction period for nuclear projects, management of local personnel in foreign markets, increasing localization demands, and tariffs."
Hyundai E&C plans to introduce the total shareholder return (TSR) concept from 2025 to 2027, setting the TSR at over 25%. It also raised the minimum dividend per share from 600 won to 800 won.
Analyst Mun noted, "The minimum dividend per share is not at a very high level based on the current stock price yield of 2.3%, but it is significant in that bond-like characteristics have emerged to support the valuation floor in a cyclical industry like construction."