Korea Electrical Equipment: A look ahead to Q226 results

研报英文原文证据摘录

Korea Electrical Equipment: A look ahead to Q226 results

Global Research

15 July 2026ab

Korea Electrical Equipment Equities

KoreaA look ahead to Q226 results

Electric Components & Equipment

Yoon Cho

Staying positive on the sector despite recent share price pullback Analyst

Korea electrical equipment stocks have pulled back sharply in the past past month, yoon.cho@ubs.com

down 25% on average for our coverage vs global peers down 2%. It appears to us that +82-2-3702 8805

unwinding of Korean retail investors' leveraged positions weighed on the sector, along Brandon Suh

with underperformance of broader AI beneficiaries in Korea amid high levels of volatility. Analyst

That said, we do not see fundamentally negative trends for the sector and remain brandon.suh@ubs.com

positive on the sector outlook. Amid the sector's underperformance, some concerns +82-2-3702 8813

were raised among investors about possible slowdown in US data center projects; but

we note that Hyundai/Hyosung are focused on utilities customers, with grid equipment

remaining an area with significant bottlenecks and sizeable unmet demand. We also

saw direct orders from data centres accelerating at LS Electric and Hyundai Electric in Q2.

We expect strong new order bookings in Q2 by Korean equipment makers to offer some

reassurance.

HD Hyundai Electric and Hyosung Heavy Industries (both Buy rated) have de-rated

below global peers on valuation (Hyundai/Hyosung at 23x/22x 2027E EPS vs global

peers 25x), despite faster EPS growth profiles given their concentrated exposure to the

US power demand. While we expect Q2 OP to be broadly in line with market's latest

expectations (including an anticipated miss at Hyosung vs sell-side consensus), we think