IBK Securities said on the 9th that GnC energy(119850) is the first AI data center beneficiary stock that can be proven by numbers. It initiated coverage with a "buy" rating and a target price of 70,000 won. GnC energy's previous trading day closing price was 44,800 won.
Cho Eun-ae, an analyst at IBK Securities, said, "With completion targeted for 2029, the AI data center projects being pursued by GS Holdings(078930), NAVER(035420), and SK(034730) total 8.4 gigawatts (GW), which converts to 4.2 trillion won for the emergency generator market," adding, "Applying GnC energy's roughly 70% market share for data center emergency generators yields as much as 2.9 trillion won." This equals roughly 10 times next year's expected emergency generator sales volume.
Cho said, "In the emergency generator institutional sector, margins for data center use are relatively large, and for data centers in the greater Seoul area or near a residence, there is a high preference for high-margin gas turbine emergency generators," analyzing that "GnC energy's new orders, revenue, and margins are likely to trend upward for the next few years." In particular, because emergency generators are ordered before data center groundbreaking, new orders appear faster than for other equipment.
As large corporations accelerate AI data center businesses, the order rush is also picking up speed. As of the first half of next year, GnC energy's emergency generator order backlog is 414.7 billion won, and since July there have been five newly disclosed orders for data center emergency generators totaling 207.2 billion won.
IBK Securities projected that GnC energy's new orders will expand from 470 billion won this year to 900 billion won next year and 1 trillion won in 2028. The order backlog is also estimated to steadily increase to 640 billion won this year, 1.2 trillion won next year, and 1.7 trillion won in 2028.
Cho said, "There are sites where sales from high-margin gas turbine emergency generators will be recognized starting in the second half of this year, and orders for large projects of 40 megawatts (MW) or more are expected to cluster from the second half of this year into next year," adding, "Even the 8.4 GW of projects scheduled through 2029 will open an annual order market of more than 1 trillion won, so it is time to raise expectations for performance-related positives such as new orders, capacity expansion, and profitability improvement."