1. KEPCO E&C’s Earnings Shock
On August 14, 2025, KEPCO E&C announced its Q2 2025 earnings. With revenue of ₩102.2 billion, an operating loss of ₩4.4 billion, and net income of ₩0.3 billion, the results fell far short of market projections. The operating loss, in particular, has raised concerns among investors.
2. Why the Disappointing Performance?
The primary reasons for this underperformance include delays in nuclear power plant construction, increased initial investment costs in the renewable energy sector, and external factors such as the rising won-dollar exchange rate and increasing raw material prices.
- 2025.2Q: Revenue ₩102.2B, Operating Loss ₩4.4B, Net Income ₩0.3B
- 2025.1Q: Revenue ₩96.4B, Operating Income ₩1.2B, Net Income ₩65.9B
- 2024.4Q: Revenue ₩192.6B, Operating Income ₩26.8B, Net Income ₩26.4B
The sharp decline in performance compared to Q4 2024 suggests a combination of short-term and long-term factors at play.
3. Investment Strategies Moving Forward
In the short term, downward pressure on the stock price is expected, requiring a cautious approach. Investors should closely monitor analyst reports and the company’s future business plans to adjust their investment strategies accordingly. In the medium to long term, investment decisions should consider factors such as changes in government energy policies, the growth potential of the renewable energy sector, and KEPCO E&C’s ability to secure competitiveness in the nuclear power business. While the stock price decline may present a buying opportunity if the underperformance is temporary and the fundamentals remain strong, thorough analysis and risk management are essential.
Frequently Asked Questions
Q: What are the main reasons for KEPCO E&C’s poor performance in the first half of 2025?
A: Delays in nuclear power plant construction, increased initial investment costs in renewable energy, the rising won-dollar exchange rate, and increasing raw material prices are considered the main factors.
Q: How should I invest in KEPCO E&C?
A: Be mindful of increased stock price volatility in the short term. A long-term perspective, analyzing the company’s fundamentals and business strategy, is recommended.
Q: What is the outlook for KEPCO E&C’s stock price?
A: Investors should monitor announcements regarding the causes of the underperformance and improvement plans, as well as changes in government policies and new business developments. Downward pressure is expected in the short term, but the medium- to long-term outlook depends on the company’s ability to secure its competitiveness.