Lee Hyo-sik is Finance Desk editor at The Korea Times. He manages finance-related stories on macroeconomics, banks, stocks, bonds, crypto etc. He is passionate about covering what's happening in Korea's financial industry and explaining it to both Korean and non-Korean readers. You can reach him at leehs@koreatimes.co.kr. Your insights and feedbacks are always appreciated.
KEPCO's operating profit to reach W9 tril. in 2015
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By Lee Hyo-sik
By Lee Hyo-sik
The Korea Electric Power Corp. (KEPCO) is expected to post a record-high 9 trillion won ($7.7 billion) operating profit this year, mainly on low crude oil and other energy prices, Mirae Asset Securities said Friday.
The securities firm said the state-run power company’s shares should be trading around 72,000 won given its improving bottom line. In the second quarter, KEPCO’s operating profit soared 151.8 percent to 2.08 trillion won from the same quarter last year, with sales gaining 6.1 percent to 13.67 trillion won. In 2014, its operating profit was 1.03 trillion won.
On Friday, KEPCO shares inched down 0.31 percent to 47,500 won from the previous day. The benchmark KOSPI rose 0.98 percent, or 19.46 points, to 1,995.95.
“KEPCO hasn’t been able to reflect its record-high performance in its share price,” said Lee Hak-moo, an analyst at Mirae Asset Securities. “This is partly because many investors are concerned that the company may be forced to cut utility prices if it posts large profits.”
Lee expected the utility company to have 15.15 trillion won in sales and a 3.1 trillion won operating profit in the third quarter. For the whole year, its operating profit would reach as high as 9 trillion won.
“Given its profit forecast and assets it holds, we believe the share price could rise to as high as 72,000 won,” he said. “In addition, KEPCO may offer special dividends to shareholders as it receives the remaining sum of 10.55 trillion won from Hyundai Motor Group later this month.”
In September 2014, Hyundai Motor agreed to pay 10.55 trillion won to buy the KEPCO headquarters in southern Seoul, which spans 79,342 square meters. The amount was more than three times the site’s appraised value.