Mirae Asset Securities said on the 6th that, despite expectations tied to nuclear power, Korea Electric Power Corporation could face rising expense burdens due to weak rate competitiveness and oil price volatility stemming from Middle East tensions, and that investors should stay on the sidelines for now. It set a neutral (HOLD) rating. The target price is 51,000 won, compared with the previous session's close of 48,200 won.
Ryu Jae-hyun, an analyst at Mirae Asset Securities, said of last year's fourth-quarter results, "With fewer business days and continued economic weakness, sales fell as volumes declined due to high electricity unit prices." In last year's fourth quarter, Korea Electric Power Corporation posted revenue of 23.688 trillion won and operating profit of 1.9834 trillion won.
Ryu said both upside and downside factors coexist around this year's performance for Korea Electric Power Corporation. Accordingly, the view is that investors should watch for a while and then decide whether to invest.
On the positive side, nuclear-related momentum and the possibility of an economic recovery are cited. Ryu said, "In 2025, power sales volume fell 0.1% due to the economic slowdown, but in 2026, the decline in volume will ease with a recovery in the growth rate and an increase in operating days." Ryu added, "Depending on the contract terms with Westinghouse, the actual revenue contribution may be limited, but an expansion of nuclear exports is positive momentum in that it could open a new market."
By contrast, weak rate competitiveness and the possibility of higher oil prices due to Middle East conflicts were flagged as headwinds. Ryu said, "Korea Electric Power Corporation is discussing with the government a revamp of seasonal and time-of-use rate plans and the introduction of region-based pricing to reflect structural changes in electricity demand such as the expansion of solar power generation," adding, "The direction of rate policy will be set by the outcome of those talks, but as of the fourth quarter of 2025, the industrial electricity unit price is around 170 won/kWh, leaving a heavy burden on industry."
Ryu added, "An increase in oil prices due to the spread of the Middle East crisis could raise the burden of fuel costs and purchased power costs."
For the target price calculation, a price-to-book ratio (PBR) of 0.6 times was applied. Korea Electric Power Corporation's share price rose to 0.8 times PBR on expectations for nuclear exports and has since corrected to 0.5 times.