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[STOCK IN FOCUS]
March 12, 2010
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| Companies that are in the business of building nuclear power plants are expected to do well for at least the next six months. In particular, the stock price of Hyundai Engineering and Construction could continue to rally on the growing expectation that it may win a deal to construct nuclear power plants for export to other countries, especially if Korea concludes a deal to build nuclear power plants in Turkey. Young Chang, the managing director and head of Korean research at the Seoul branch of UBS Securities, said, “Hyundai E&C has been building nuclear power plants for many years. Given that, the firm has a good chance [of winning the deal].” Hyundai E&C’s stock price rose to 65,200 won yesterday, up 700 won from the previous trading day. The price had dropped to as low as 54,900 won in February, after soaring to 70,000 won following news that a Korean consortium had won a $40 billion deal to build nuclear power plants in the United Arab Emirates in December. On the back of the release of news that Korea and Turkey had signed a joint declaration Wednesday for construction of a nuclear power plant in northern Turkey, companies in the nuclear power plant business saw their share prices rise on both the Kospi and Kosdaq. “Signing a nuclear power plant deal with another country is not something that we see regularly. It is a very rare deal,” Kim Seung-chul, a researcher with Meritz Securities, said. “I don’t believe that Korea’s deal with the U.A.E in December will be the only one. I am confident that Korea will also conclude its nuclear power plant deal with Turkey in the near future,” he added. When asked about an investment strategy for nuclear power plant-related stocks, Kim said, “Investors still expect that the country may make other nuclear power plant export deals with other countries in the future, therefore the purchase of shares in these companies should be considered a long-term investment.” By Jung Jae-yoon [jyj222@joongang.co.kr] |
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