KB Securities: "Doosan Enerbility's U.S. nuclear order clock will speed up... target price set at 140,000 won"

[Financial News] A forecast has emerged that Doosan Enerbility's order momentum in the new U.S. nuclear power market could accelerate. The reason is that suppliers can now place orders for long-lead equipment before actual nuclear construction begins.
On the 25th, KB Securities maintained its investment rating of "buy" and its target price of 140,000 won for Doosan Enerbility. That implies 91% upside from the previous day's closing price.
Doosan Enerbility's stock had been under pressure since early May, even as the U.S. government pushed to expand nuclear power, because actual project starts were delayed. However, KB Securities viewed this not as a retreat in the nuclear cycle, but as a time lag between orders and construction.
The turning point is the long-lead equipment financing program announced in June by the United States Department of Energy (DOE). It allows major equipment orders to be placed even before a final investment decision (FID). For Doosan Enerbility, a supplier of key long-lead equipment for AP1000 reactors, this means orders could materialize before construction begins.
Researcher Jung Hye-jung said, "The most noteworthy project is the 10 AP1000 units being pursued by Westinghouse Electric Company and a U.S. utility through a special purpose vehicle (SPV)," adding, "Since the goal is to begin operation in the mid-2030s, advance orders for long-lead equipment are seen as a key driver of future order momentum."
The Poland nuclear project and new domestic nuclear plants are also expected to support growth. The Polish project, which aims to begin operations in 2036, is gaining pace, and the 12th Basic Plan for Electricity Supply and Demand, due to be announced by the end of the year, could include plans for new nuclear plant construction.
Improved earnings are also expected. KB Securities forecast that Doosan Enerbility's revenue this year will rise 11.2% from a year earlier to 19 trillion won, while operating profit will jump 58.2% to 1.2 trillion won. It said growth will be driven by nuclear equipment orders from the Czech Republic and gas turbine orders for U.S. data centers.
With 53.4% of its annual order target of 13.3 trillion won already secured, the company could exceed its full-year guidance if additional Czech Republic nuclear EPC work and gas turbine orders are added in the second half.
Jung said, "Although full-scale construction of large nuclear plants has not yet begun, the outlook for the industry has not changed significantly and is in fact accelerating with support from the U.S. government."
She added, "Ultimately, the key point to watch is not the 'construction start date' for U.S. nuclear plants, but the 'equipment order date.' Since advance orders are now possible before the FID, the impact of the North American nuclear market expansion may first appear in Doosan Enerbility's orders."
[email protected] Kim Kyung-a Reporter