IBK Securities: "LOTTE INNOVATE targets a 30% DBO revenue share as AIDC demand takes off"

[Financial News] LOTTE INNOVATE's data center DBO (Design, Build, Operate) business is expected to enter a full-fledged growth phase.
According to the research division of IBK Securities on the 19th, demand for turnkey DBO services that combine design, construction and operational capabilities is expected to grow rapidly as investment in domestic AI data centers gains momentum.
Lee Seung-hoon, head of research at IBK Securities, said, "LOTTE INNOVATE's data center business is expected to maintain solid expansion, supported by its accumulated operational expertise and market growth." He added, "LOTTE INNOVATE has set a goal of expanding its new data center DBO business to account for 30% of companywide revenue by 2028."
He also identified LOTTE INNOVATE's experience operating four data centers that it built itself over approximately 20 years as one of the DBO business's competitive advantages. Unlike colocation, which involves leasing existing infrastructure, the DBO model covers the entire process for customer-owned data centers, from design and construction through operations after completion.
The expanding participation of financial investors (FIs), including asset management companies and private equity funds, in data center development was also cited as a favorable environment for LOTTE INNOVATE's future growth.
LOTTE INNOVATE won a contract to operate the Kamsquare Data Center in December 2025. In February 2026, it secured a DBO contract for the IGIS Asset Management Edge Data Center, followed by an additional contract to operate the Ansan Data Center in August. The data center has a capacity of 40 MW. LOTTE INNOVATE's cumulative data center orders to date total approximately 130 billion won, while its managed capacity has reached 110 MW.
IBK Securities also viewed improving performance at subsidiaries positively. EVSIS, the electric vehicle charging business, secured new orders from South Korea's public sector in June this year and from the United States in July. As revenue recognition for those orders begins, the contracts are expected to drive a rebound in performance in the second half. In particular, revenue at EVSIS's U.S. subsidiary is projected to approximately double in 2026 from the previous year.
Earnings growth is also expected to continue. LOTTE INNOVATE's consolidated operating profit is estimated to rise from approximately 45 billion won in 2026 to approximately 56 billion won in 2027 and approximately 67 billion won in 2028. Over the same period, return on equity (ROE) is expected to improve from 6.4% to approximately 10.0%.

[email protected] Yeon Ji-an Reporter