| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | n/a | -100 |
| Intrinsic value (DCF) | 30.22 | 50 |
| Graham-Dodd Method | 29.80 | 47 |
| Graham Formula | 27.50 | 36 |
Korea Electric Power Corporation (KEPCO) is a leading integrated electric utility company headquartered in Naju-si, South Korea. Established in 1961, KEPCO operates across multiple segments, including Transmission and Distribution, Nuclear Power Generation, and Thermal Power Generation, serving residential, commercial, industrial, and agricultural customers. The company boasts a diversified energy portfolio, generating electricity from nuclear, coal, LNG, hydro, wind, solar, and other renewable sources, with an installed capacity of 82,459 MW as of 2021. KEPCO maintains an extensive infrastructure, including over 34,923 circuit kilometers of transmission lines and 892 substations, ensuring reliable power distribution across South Korea. As a state-owned entity, KEPCO plays a pivotal role in South Korea's energy security and decarbonization efforts, aligning with global sustainability trends. The company also engages in utility maintenance, nuclear fuel sales, and IT services, reinforcing its integrated utility model. With a market cap of approximately $14.7 billion, KEPCO is a key player in the regulated electric utilities sector, balancing operational scale with strategic investments in clean energy.
Korea Electric Power Corporation (KEPCO) presents a mixed investment profile. On the positive side, its regulated utility status provides stable revenue streams, while its diversified generation mix (including nuclear and renewables) aligns with global decarbonization trends. The company's extensive infrastructure and dominant market position in South Korea further underpin its defensive appeal. However, KEPCO faces significant risks, including high leverage (total debt of ~KRW 24.4 trillion), exposure to volatile fuel costs, and geopolitical tensions given its state-owned structure. The company's profitability is also sensitive to government-regulated tariffs, which may limit pricing power. While its beta of 0.59 suggests lower volatility relative to the market, investors must weigh its modest dividend yield (~0.07 per share) against these operational and financial risks. KEPCO's long-term attractiveness hinges on its ability to manage debt, transition to cleaner energy, and navigate regulatory pressures.
KEPCO's competitive advantage stems from its vertically integrated monopoly in South Korea's electricity market, backed by government support and economies of scale. Its nuclear expertise (a rarity among global utilities) provides low-cost baseload power, while its diversified generation fleet mitigates fuel-specific risks. The company's vast transmission and distribution network (~532,348 circuit kilometers) creates high barriers to entry. However, KEPCO's state ownership introduces inefficiencies and limits agility compared to privatized peers. Its reliance on regulated returns caps profitability, and rising renewable adoption may challenge its thermal-heavy portfolio. Competitively, KEPCO lags behind global leaders like NextEra Energy in renewable energy penetration but benefits from a captive domestic market. Its international ventures (e.g., overseas nuclear projects) offer growth but carry execution risks. Financially, KEPCO's high debt-to-equity ratio (~166% based on provided data) weakens its position against better-capitalized rivals. The company must accelerate its energy transition (e.g., offshore wind investments) to maintain relevance amid global decarbonization trends.