INDIA FIRST TO MARKET

Research evidence excerpt

INDIA FIRST TO MARKET

Sanjay Mookim AC Asia Pacific Equity Research

(91-22) 6157-3600 07 July 2026 J P M O R G A N

sanjay.mookim@jpmorgan.com

We have observed rising investor skepticism regarding the upcycle for Asian power equipment companies. In this note, we

summarize investors’ key questions and our responses. For Korean power equipment companies, we believe the key concerns

include the recent flattening in T&D equipment prices, as indicated by monthly data (Figure 2 UStransformerPI-Figure 3 AverageunitvalueofSouthKoreantransformerexportstotheUS(over10MVA)), delays in ultra-high-

voltage transmission lines in the U.S., and a high base for new orders in 1Q. Our view is that pricing for high-voltage T&D

equipment is still holding up well, with ~40% OPM or above for UHV products, supported by delays in capacity expansion plans

by some players, the difficulty for EM players such as China and India to penetrate the U.S. regulated market, and

exceptionally strong demand from both utilities and data centers. While there have been delays in UHV transmission build-out

in the U.S., we see this more as a near-term scheduling/phasing issue rather than a structural slowdown in transmission needs.

The recent heatwave and spike in power prices (Figure 5 PJM2027forwardATCpowerprices) have brought grid constraints to the forefront, while decades-long

underinvestment in transmission lines remains unresolved (Figure 6 Milesofnew345kV+transmisionlinesbuiltoverthelast15years). Although upcoming 2Q26 results could be less exciting

for names such as Hyosung Heavy, given a high base and potential order delays related to Middle East conflicts (see our 2Q

preview), we view this as an opportunity to accumulate quality names. We see a good entry level for Hyosung Heavy if it falls