J.P. Morgan South Korea FTM 23 Jun 26 KEPCO; Korea Economics and More

Research evidence excerpt

J.P. Morgan South Korea FTM 23 Jun 26 KEPCO; Korea Economics and More

Asia Pacific Equity Research

South Korea First to Market 23 June 2026

Top Stories

KEPCO (Sonny Lee) (015760 KS, UW)

Flat electricity tariff retained; key FAQ after our rating downgrade to Underweight

KEPCO will retain electricity tariffs in 3Q. Our sensitivity suggests a 1% (W1.7/kWh) tariff hike would add ~W550bn to NP

(~34% upside to our 2027E NP of W1.7tn), but near-term tariff upside remains limited. Separately, the government plans to

introduce a regional electricity pricing framework, which should be neutral to KEPCO’s P&L in theory, but would require

monitoring around implementation and province-level tariff outcomes. Investor views after our downgrade (N → UW, link ) are

polarized, hinging on macro assumptions and the Middle East conflict path. We maintain Underweight given worsening macro

(FX, commodities, rates) and a ‘muddled slowdown’ that keeps costs elevated without forcing policy support.

Korea: June 20-day exports sustain high growth in 2Q (Jooeun Kim)

In the first 20 days of June, Korea’s customs exports rose by 60.4% oya and the full-month estimate is for the same growth

(Figure 1). On our seasonally adjusted basis, 20-day exports increased 8.4% m/m, a moderation from the 12.5% gain in the 10-

day trade data, yet still indicating a solid gain (Figure 2). Today’s readings reaffirm that 2Q has maintained exceptionally high

nominal export growth, alongside resilient real export momentum.