NH Investment & Securities said on the 19th that a valuation reappraisal of Hyundai Engineering & Construction is needed as groundbreaking and orders for major nuclear power plant projects this year are becoming visible.
It maintained a "buy (BUY)" investment opinion while raising the target price to 240,000 won from 150,000 won. The previous transaction day's closing price of Hyundai Engineering & Construction was 170,100 won.
Lee Eun-sang of NH Investment & Securities said, "Core nuclear power projects are taking shape, including the conversion to EPC for the Palisades Small Modular Reactor (SMR) and the Matador project within the year," and added, "Accordingly, the valuation gap with Doosan Enerbility will also gradually narrow."
NH Investment & Securities raised Hyundai Engineering & Construction's valuation multiple to 22 times. This is in line with the global average for similar corporations and is still about a 34% discount compared with Doosan Enerbility (33 times), Korea's representative nuclear power stock.
It projected 2030 as the point when revenue will start in earnest, as projects scheduled to break ground in 2026–2027 are reflected in results in sequence. Specifically, assuming the Palisades SMR (1 trillion won), a large nuclear power plant in Bulgaria (2 trillion won), and orders for four large nuclear power units in the United States, it expected total revenue of 5 trillion won.
Hyundai Engineering & Construction's key strengths were cited as its nuclear power construction track record and talent base. The analyst said, "It has about 900 nuclear power specialists and has the capacity to build up to six units simultaneously at peak," and added, "On top of that, as the only contractor to have met schedules and completed construction within budget over the past 10 years, it has the highest level of global competitiveness in nuclear power orders."