1. What Happened?

On July 29, 2025, KEPCO E&C signed a $30 million contract with Korea East-West Power for the design and engineering services of the SinHonam and SinIlsan combined cycle power plant construction project. The contract period extends until March 2031. This represents a substantial 7.27% of KEPCO E&C’s projected revenue for 2025.

2. Why is it Important?

This contract is expected to contribute to revenue growth and improved profitability in the short term. Notably, it is anticipated to partially offset the decline in sales experienced in the first quarter. In the long run, it aligns with KEPCO E&C’s strategy to diversify its business portfolio beyond nuclear power, venturing into new energy businesses and combined cycle power plant design. It’s also expected to enhance technological competitiveness.

3. What’s the Outlook?

While there is a potential for a short-term stock price increase, sustained growth will depend on improvements in fundamentals. From a long-term perspective, it can contribute to securing a stable revenue base and enhancing technological competitiveness. However, considering the 5-year and 8-month contract duration, managing macroeconomic risks such as exchange rate fluctuations, raw material price changes, and interest rate fluctuations is crucial.

4. What Should Investors Do?

Investment decisions should focus on KEPCO E&C’s long-term growth potential rather than short-term stock price fluctuations. A comprehensive investment strategy should be developed, considering factors like SMR project progress, Czech nuclear power plant project development, and the strengthening of competitiveness in new energy businesses.