April 20, 2024

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[THE INVESTOR] Daewoo Engineering and Construction’s stock price has recently dipped over uncertainties in its overseas business but it could be a chance to purchase them, said Shinhan Financial Investment on Dec. 13, maintaining a “buy” recommendation and 8,500 won (US$7.78) target price. 

Its stock price fell 17 percent in a month as major losses from overseas projects, including 145 billion won from Qatari expressway and 23 billion won from Moroccan power plant, triggered concerns, said analyst Oh Gyeong-seok.

The fact that oil companies such as Aramco were not on the list of candidates to take over stake from Korea Development Bank also dented the stock price but these two factors have already been reflected, noted the analyst. 

Its earnings will remain on an upturn as overall environment improves, and its revenue in the fourth quarter will rise 8.4 percent on-year to 2.9 trillion won and operating profit will come in at 211.8 billion won, turning to black from a year ago, forecast Oh.

Its current stock price is the lowest among major construction companies and although uncertainties do remain it is time to purchase them considering the size of its profits next year, he added.

By Hwang You-mee (glamazon@heraldcorp.com)