[THE INVESTOR] It may be too early for Korea Electric Power Corp. to raise rates but cost burdens are easing, said Mirae Asset Daewoo on Nov. 14 maintaining a “buy” recommendation and 33,000 won (US$29.12) target price.
Fuel costs hiked 27 percent on-year in the second quarter but the rate is decreasing and the recent decline in oil prices and stabilization of nuclear power plant operation ratio will keep a check. The operation ratio of nuclear power plants is estimated to be between 70-75 percent and is likely to rise past 80 percent in the fourth quarter when the furnaces of Hanbit and Hanul stations resume operations, said analyst Ryu Je-hyeon.
KEPCO’s operating profit in the third quarter halved from last year to 1.4 trillion won but still beat market expectations, as sales increased from favorable weather and rate cut, while the price fall was smaller than estimated, said the analyst.
By Hwang You-mee (firstname.lastname@example.org)