Key points
- Report puts eight US reactors in Korea's investment package
- KEPCO E&C (052690) rose 32.5% in two days
- Two Kosdaq suppliers closed at their daily limit
- The reactor design is still being negotiated
Korean companies that design and build nuclear plants rose for a second day on Tuesday. What's behind the move is a reported proposal for Korea to help build eight large reactors in the United States. KEPCO Engineering & Construction (한국전력기술), which designs Korea's reactors, closed 16.60 percent higher at 142,600 won. That's a rise of about 33 percent in two sessions.
The proposal became public on September 7, when Money Today (머니투데이) reported that Korea's follow-up investment in the United States includes eight reactors at a cost of about $130 billion. Six would use Westinghouse's AP1000 design and two would use the APR1400, the Korean reactor. A ruling party official told the paper that "we reached an agreement on building eight reactors, and the formal announcement of the US investment is planned for around the 18th." The Ministry of Trade, Industry and Energy said the two countries are in talks to find reactor projects but that nothing specific has been decided, Etoday (이투데이) reported.
The buying went furthest down the list of smaller suppliers. Orbitech (오르비텍), a Kosdaq company that handles radiation management and reactor inspections, closed at its daily limit, up 29.83 percent at 6,050 won. Seojeon Electric (서전기전), which makes electrical equipment for nuclear plants, also closed at the limit, up 29.80 percent. Korean stocks can move 30 percent in a day, so a limit-up close is the most a stock is allowed to rise. Doosan Enerbility (두산에너빌리티), which forges the heavy reactor components, added 1.8 percent on Tuesday after rising 11 percent on Monday.
The reason Korean companies are in an American reactor plan at all is that almost nobody in the United States has built one recently, while electricity demand from AI data centers keeps rising. Yang Seung-yoon, an analyst at Eugene Investment & Securities (유진투자증권), pointed to the Korean design's existing NRC certification. "From the American point of view, the APR1400 is the best option available, since it has obtained NRC design certification and is backed by the construction experience of Korean builders," he said. "It's a way to meet America's power security and its national interest at the same time." The APR1400 has NRC design certification, allowing developers to reference an approved standard design in a license application. Individual projects still require regulatory approval.
