Overseas Orders - Korea Stock Market Insights

What’s Happening with Sungkwang Bend?

Sungkwang Bend recorded sales of KRW 121.8 billion (a 1.9% decrease year-on-year), operating profit of KRW 21.5 billion (a 48.7% decrease), and net income of KRW 15.6 billion (a 62.5% decrease) in the first half of 2025. The global economic slowdown and increased cost burdens are considered the main factors.

Reasons Behind the Decline and Future Outlook

Despite the decline in performance due to external factors, Sungkwang Bend suggests future growth potential based on its solid order backlog, especially consistent orders from overseas markets. Positive factors also exist, such as prolonged high oil prices, strengthened environmental regulations, and robust demand in the shipbuilding/marine and power generation sectors. The weak Korean Won can be advantageous for Sungkwang Bend as an exporting company.

What Should Investors Do?

Key IR Checkpoints: Closely examine cost management measures, overseas market expansion strategies, and concrete performance and profitability improvement plans for the solar power business.
Investment Strategy: It is crucial to make investment decisions based on a comprehensive assessment of the likelihood of earnings improvement, overseas business expansion strategies, and profitability of new businesses based on the IR content.

1. Hyundai E&C H1 2025: What Happened?

Hyundai E&C recorded consolidated revenue of KRW 15.17 trillion in H1 2025, a 53.6% decrease year-on-year. The downturn in the domestic building/housing market and the base effect of past large-scale orders were the main causes. However, through enhanced cost management and improved profitability in overseas plant projects, the company achieved an operating profit of KRW 430.7 billion and a net profit of KRW 325.3 billion, marking a return to profitability.

2. The Secret to Profitability: Why Energy?

Overseas revenue in the plant/new energy sector grew strongly, increasing by 66.8% year-on-year. Winning major overseas projects, such as the Bulgarian nuclear power plant and being selected as an EPC partner for Saudi Aramco, were key drivers of this improvement. The ‘energy-centric growth’ strategy is being successfully implemented, and active investments are being made in the hydrogen energy business, which has been added as a future growth engine.

3. Investment Strategy: What Should You Do?

Hyundai E&C is securing long-term growth potential through growth in its energy business and diversification of overseas markets. However, risk factors such as high debt-to-equity ratio, macroeconomic uncertainties, and potential litigation and dispute issues remain. Therefore, a conservative investment approach is necessary in the short term, and close monitoring of future overseas orders, new business performance, financial soundness management, and the progress of litigation and dispute issues is crucial.

4. Action Plan for Investors

Short-term investors: Maintaining a neutral investment opinion and adopting a flexible strategy that responds to changing market conditions is necessary.
Long-term investors: Focusing on the growth potential of the energy business and overseas market diversification while continuously monitoring risk factors is crucial.

Tag: Overseas Orders

Sungkwang Bend’s IR: Uncovering Investment Opportunities Amidst Q2 Earnings Decline