[Click eStock] "KEPCO KPS, Increased Upside Potential... Investment Rating Upgraded to 'Buy'"

[Asia Economy Reporter Minji Lee] Hana Financial Investment raised its investment opinion on KEPCO KPS from neutral to buy on the 17th, citing increased upside potential compared to the current stock price, while maintaining the target price at 40,000 KRW.

KEPCO KPS's sales in the first quarter are expected to increase by 8.2% year-on-year to 263.1 billion KRW. This appears to be due to the low base effect from extremely poor sales recognition in the first quarter of last year. Operating profit is expected to rise by 15.7% to 20.9 billion KRW during the same period.

Researcher Jaeseon Yoo of Hana Financial Investment explained, "This year, external and overseas growth is expected due to the rationalization project of the Gwangyang power plant and the ongoing maintenance of the UAE nuclear power plant," adding, "The impact of shutdown issues in some emerging countries such as India due to the spread of COVID-19 needs to be monitored going forward."

Since power plant maintenance work is minimally affected by external variables, the stability of performance is expected to be highlighted. A key point to watch for this year's performance is the management evaluation grade to be announced in June. If the grade is C or higher, concerns about profit decline compared to the previous year are expected to arise.

Researcher Yoo said, "Quarterly performance is highly volatile due to conservative accounting, but it is expected to be stable on a semi-annual and annual basis," and added, "If there is a reversal related to the ordinary wage lawsuit within the year, the decrease in net profit will be limited, and the dividend size will be maintained."

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