Lee Yeon-woo is a financial journalist at The Korea Times. Her wide range of reporting includes policies, macroeconomics, stock market, companies and even crypto. She is passionate about connecting the dots in Korean finance and making it easier for foreign nationals to understand. Based on her previous experience as a national reporter, she also has a keen interest in social issues within the sector, including gender equality and ESG. Your tips and insights are always appreciated. You can send them to yanu@koreatimes.co.kr.
Why KEPCO has become foreign investor favorite
An official at Korea Electric Power Corp. monitors the power supply situation at its operating center in Suwon, Gyeonggi Province, July 28. Newsis
By Lee Yeon-woo
Korea Electric Power Corp. (KEPCO) has become the top non-semiconductor pick among foreign investors, driven by optimism over a rebound in earnings and a push into global nuclear markets, analysts said Thursday.
Foreign investors net purchased 1.2 trillion won ($846.4 million) in KEPCO shares between Jan. 2 and Oct. 10, making it the third most purchased stock in that period, according to the Korea Exchange.
Only Samsung Electronics and SK hynix drew more, with net purchases of 6.5 trillion won and 2.6 trillion won, respectively.
Despite its smaller scale, the utility has seen steady inflows amid signs of a turnaround. KEPCO's market cap is just 4-8 percent of both chip giants' and about half that of Hanwha Aerospace, which ranked fourth in terms of net purchase.
Shares closed at 40,200 won, up 2.16 percent on Thursday. Foreign ownership now stands at roughly 22 percent, up six percentage points year-to-date.
"The return of foreign investors in 2025 reflects renewed confidence in KEPCO's earnings reliability," said Moon Kyeong-won, an analyst at Meritz Securities. "Consecutive tariff increases, stabilizing raw material prices, and the resumption of dividends have all supported the recovery in trust."
KEPCO struggled with losses for a significant period. As a state-run company, it sells electricity to consumers at low prices, even when energy costs rise. The government has capped public utility rates since May 2023 as a way to curb inflation and support low- and middle-income households.
However, the company's performance is showing signs of a rebound, fueled by stabilizing raw material prices.
After turning a profit last year with an operating income of 8.36 trillion won, the company is expected to post an operating profit of around 14 trillion won this year, according to market consensus. It also resumed dividend payments earlier this year after a four-year hiatus.
As President Lee Jae Myung has emphasized the need to bring electricity rates in line with actual costs, there is also a possibility that electricity rates will be raised next year. With total debt of 206 trillion won and an accumulated deficit of 29 trillion won, KEPCO urgently needs that rate adjustments to restore financial stability.
Adding to the momentum is its push to enter the U.S. nuclear power market.
"As quarterly earnings continue to show improvement, further increases in foreign ownership are expected. The current foreign ownership ratio of 22 percent remains well below the 30-35 percent levels seen before 2018," Moon said. "We are particularly focused on the re-rating narrative driven by overseas nuclear power projects."