Group 1 - Samsung SDI and Korea Electric Power Corporation's subsidiary, Korea East-West Power, signed a memorandum of understanding for global energy project collaboration, focusing on the development of energy storage and renewable energy projects and new business models [1] - This collaboration is expected to have a positive impact on Korea Electric Power's long-term business expansion [1] Group 2 - Korea Electric Power's stock price has shown volatility over the past week, with a decline of 3.82% on February 10, closing at $20.90, followed by a rebound of 2.44% on February 11, closing at $21.41, and a slight drop of 0.28% on February 12, closing at $21.35 [2] - The stock's price fluctuation over the week reached 5.43%, with a year-to-date increase of 29.36% [2] - The current price-to-earnings ratio (TTM) for Korea Electric Power is 4.67, and the price-to-book ratio is 0.86 [2]

Stock Performance - On January 7, 2026, Korea Electric Power's stock price experienced a sharp decline of 5.08%, closing at $16.99 per share, with an intraday volatility of 2.68% [1] - At that time, 71% of brokerage firms rated the stock as a buy, with no sell recommendations [1] Financial Status - As of January 27, 2026, the company's latest financial data indicated a trailing twelve months (TTM) earnings per share of 2,925.00 KRW, a current ratio of 0.48, and a return on equity (ROE) of 8.43% [2] - These metrics reflect the company's operational status as of the specified date [2] - Regular events such as quarterly earnings reports should be confirmed through official announcements from Korea Electric Power [2]

Core Viewpoint - The comparison between Korea Electric Power (KEP) and WEC Energy Group (WEC) indicates that KEP presents a better value opportunity for investors at this time due to its stronger earnings outlook and favorable valuation metrics [1][3]. Valuation Metrics - KEP has a forward P/E ratio of 3.37, significantly lower than WEC's forward P/E of 20.16, suggesting KEP is undervalued relative to WEC [5]. - KEP's PEG ratio is 0.06, while WEC's PEG ratio is 2.71, indicating that KEP's expected earnings growth is more favorable compared to its current price [5]. - KEP's P/B ratio stands at 0.8, compared to WEC's P/B of 2.62, further highlighting KEP's relative undervaluation [6]. Zacks Rank and Style Scores - KEP holds a Zacks Rank of 2 (Buy), indicating a positive earnings estimate revision trend, while WEC has a Zacks Rank of 3 (Hold) [3]. - KEP's Value grade is A, contrasting with WEC's Value grade of D, suggesting that KEP is more appealing to value investors [6].

Group 1 - The core point of the article is that the stock price of Korea Electric Power Corporation surged by 6.4% following the proposal from the United States to build nuclear power plants [1]

Group 1 - The stock price of the Korean Electric Power Corporation has increased by 19% as of January 20 [1]

Core Insights - The article emphasizes the importance of looking beyond U.S. large caps for investment opportunities, particularly in undervalued international stocks [1][3][9] - The Benzinga Value Ranking is introduced as a systematic, numbers-driven tool to identify the cheapest stocks globally based on multiple valuation metrics [2][5] Investment Strategy - Investors are encouraged to focus on the top decile of the Benzinga Value Ranking, specifically targeting non-U.S. stocks to access the cheapest part of the global market [7][9] - The current market environment is characterized by extreme valuation dispersion outside the U.S., with many profitable companies trading at low earnings multiples [4][6] Company Highlights - **POSCO Holdings (NYSE:PKX)**: A leading steel producer in South Korea, trading at discounted multiples despite controlling high-quality assets [11] - **Sasol Ltd. (NYSE:SSL)**: An integrated energy and chemicals company in South Africa, generating substantial cash flow but heavily discounted due to past operational issues [12] - **Korea Electric Power Corp. (NYSE:KEP)**: The backbone of South Korea's power system, facing extreme low valuation multiples due to government pricing controls [13] - **LuxExperience (NYSE:LUXE)**: A niche luxury travel company in the Netherlands, undervalued due to lack of investor attention rather than demand collapse [14] - **Gerdau (NYSE:GGB)**: Brazil's largest long steel producer, trading at low multiples despite consistent cash flow generation [15] - **Honda Motor (NYSE:HMC)**: A global manufacturing leader in Japan, undervalued due to lack of hype around its steady profits and cash flow [16] - **SK Telecom (NYSE:SKM)**: South Korea's largest wireless carrier, undervalued due to low growth expectations despite reliable cash generation [18] - **Jiayin Group (NASDAQ:JFIN)**: A Chinese fintech company facing regulatory uncertainty, leading to extreme valuation discounts [19] - **FinVolution Group (NYSE:FINV)**: Another Chinese fintech platform, similarly undervalued due to regulatory challenges and investor distrust [20] - **KT Corp. (NYSE:KT)**: A leading telecommunications provider in South Korea, generating stable cash flow but facing compressed valuation multiples [21]

Core Insights - The article emphasizes the focus on value investing in Asia, particularly in Hong Kong, targeting stocks with significant discrepancies between market price and intrinsic value, including deep value balance sheet bargains and wide moat stocks [1] Group 1: Investment Strategy - The research service aims to identify Asia-listed stocks that are undervalued, specifically looking for deep value balance sheet bargains such as net cash stocks and low price-to-book (P/B) ratio stocks [1] - The service also focuses on wide moat stocks, which are high-quality businesses with strong competitive advantages, providing potential for earnings growth at a discount [1] Group 2: Market Expertise - The analyst has over a decade of experience in the Asian equity market, both on the buy and sell sides, indicating a strong understanding of market dynamics and investment opportunities [1] - The investment group provides monthly updates and watch lists, showcasing a commitment to keeping investors informed about potential investment opportunities [1]

Financial Performance - For the nine-month period ended September 30, 2025, KEPCO reported total sales of 73,746 billion Won, an increase of 3,877 billion Won (approximately 5.6%) compared to the same period in 2024[11]. - Operating profit for the same period rose to 11,541 billion Won, reflecting an increase of 5,595 billion Won (approximately 94.2%) year-over-year[17]. - Net income for the nine months ended September 30, 2025, was 7,328 billion Won, up by 4,738 billion Won compared to a net income of 2,590 billion Won in 2024[17]. - Electricity sales increased to 72,468 billion Won in 2025, compared to 68,664 billion Won in 2024, marking a growth of approximately 5.2%[12]. - The operating profit from nuclear generation surged to 3,186 billion Won, up from 1,794 billion Won in the previous year, indicating an increase of 77.5%[12]. - Total comprehensive income for the nine-month period ended September 30, 2025, was W 6,848,962 million, up from W 2,504,587 million in 2024, indicating a year-over-year increase of 173%[67]. - Profit for the nine-month period ended September 30, 2025, increased to W 7,328,083 million, compared to W 2,589,999 million for the same period in 2024, representing a growth of 182%[65]. Assets and Liabilities - KEPCO's total assets as of September 30, 2025, amounted to 253,092 billion Won, an increase of 6,284 billion Won from 246,808 billion Won in 2024[17]. - Total liabilities as of September 30, 2025, were W 205,340,214 million, slightly down from W 205,444,962 million as of December 31, 2024, indicating a marginal decrease of about 0.05%[62]. - The equity attributable to owners of the controlling company increased to W 46,553,523 million as of September 30, 2025, from W 39,915,236 million as of December 31, 2024, reflecting a growth of approximately 16.5%[62]. - Non-current assets as of September 30, 2025, totaled W 201,148,927 million, an increase from W 195,972,142 million as of December 31, 2024, reflecting a growth of approximately 2.2%[101]. Shareholder Information - KEPCO's issued share capital stands at 3.2 trillion Won, with a total of 641,964,077 shares issued[10]. - The total number of shareholders as of September 30, 2025, was 564,729, with a total of 641,964,077 shares owned[38]. - The government of the Republic of Korea holds 18.20% of the total shares, while Korea Development Bank holds 32.90%[38]. Legal and Regulatory Matters - KEPCO and its subsidiaries are involved in 720 lawsuits as defendants, with a total claimed amount of 854 billion Won[43]. - The company reported an administrative fine of 144 million Won related to the Nuclear Safety Act[45]. - The attendance rate of standing directors for the nine-month period ended September 30, 2025, was 72.7% to 100%[28]. Investments and Subsidiaries - The company maintains a 100% ownership in several subsidiaries involved in power generation and utility operations across various countries, including Korea, the Philippines, and Australia[146]. - New investments were made in four subsidiaries during the nine-month period ended September 30, 2025, including KEPCO Yona America LLC and KEPCO SADAWI – FZCO[150]. - KEPCO's subsidiary Paju Ecoenergy Co., Ltd. increased its ownership percentage from 89.00% to 93.68%[148]. Financial Instruments and Derivatives - The total amount of long-term financial instruments as of September 30, 2025, is W 805,019 million, compared to W 812,211 million as of December 31, 2024[139]. - The company has multiple interest rate swap contracts with varying pay and receive rates, with the highest pay rate being 5.45% and the lowest receive rate being 1.05%[135]. - The company recognized a gain on transaction of derivative instruments amounting to W 37,572 million for the nine-month period ended September 30, 2025[129]. Cash Flow and Operating Activities - Cash flows from operating activities for the nine-month period ended September 30, 2025, amounted to W 17,014,717 million, compared to W 15,319,248 million in 2024, an increase of 11%[70]. - Cash generated from operating activities increased to W 21,884,132 million in 2025 from W 16,735,786 million in 2024, representing a growth of 30.5%[71]. - The company reported a net gain on valuation of derivatives applying cash flow hedge accounting of W 14,208 million for the nine-month period ended September 30, 2025, compared to a loss of W 28,608 million for the same period in 2024[137]. Employee Information - The total number of employees as of September 30, 2025, was 22,397, with an average salary of 71,562,000 Won[41]. - The average continuous service year for employees was 15.0 years[41]. - The total remuneration for standing directors was 1,215,660,000 Won, averaging 202,610,000 Won per person[40]. Strategic Plans and Approvals - Approval of the mid-to long-term financial management plan for 2025-2029[25]. - Approval of the 1st long-term plan for power distribution[28]. - Approval of investment in the fund for cooperation between large enterprises and small and medium enterprises in 2025[28].

Core Perspective - A group of South Korean farmers, led by Hwang Seong-yeol, has filed a lawsuit against Korea Electric Power Corporation (KEPCO) and its subsidiaries, claiming that their reliance on fossil fuels has exacerbated climate change, leading to agricultural losses [3][4][9]. Group 1: Lawsuit Details - The lawsuit is the first of its kind in South Korea, questioning the quantification of power companies' contributions to climate change and the resulting agricultural damage [4]. - The plaintiffs are seeking initial damages of 5 million won ($3,400) per farmer, with a symbolic request for 2,035 won ($1.4) each to advocate for the phase-out of coal power by 2035 [11]. - KEPCO produced approximately 30% of South Korea's greenhouse gas emissions from 2011 to 2022, which corresponds to about 0.4% of global emissions [10]. Group 2: Impact on Agriculture - Farmers are experiencing significant crop damage due to increasingly erratic weather patterns attributed to climate change, with Hwang expecting a yield reduction of 20% to 25% this year [6][8]. - The South Korean government reported that extreme weather events in 2024 led to "agricultural disasters," affecting thousands of hectares of cropland, particularly rice [8]. - Farmers are facing higher production costs and must use more labor and pesticides to manage the impacts of climate change on their crops [17]. Group 3: Energy Transition Challenges - South Korea's energy mix in 2024 included only 10.5% renewable energy, with KEPCO subsidiaries relying on coal for over 71% of their electricity production [11]. - Experts highlight that KEPCO's significant debt, exceeding 200 trillion won ($137 billion), limits its ability to invest in renewable energy and modernize the power grid [12]. - The slow transition to renewable energy in South Korea may hinder the country's ambitions in advanced technology sectors, as global pressure mounts for cleaner energy operations [16].

Financial Data and Key Metrics Changes - The consolidated operating profit for Q3 2025 was KRW 11.541.4 trillion, with sales revenue increasing by 5.5% to KRW 73 trillion [4][5] - Electricity sales revenue reached KRW 70 trillion, up by 5.9%, while other revenue, including overseas business income, decreased by 0.9% to KRW 3.115 trillion [4][5] - Cost of sales and SG&A expenses totaled KRW 62.205 trillion, down by 2.7%, with fuel costs decreasing by 16% to KRW 14.026 trillion [5] Business Line Data and Key Metrics Changes - Electricity sales volume in Q3 reached 419.9 terawatt hours, up 0.4% year-over-year, primarily due to a summer heat wave [6] - For the full year of 2025, electricity sales are projected to decline slightly due to lower economic growth and a downturn in the manufacturing sector [6] Market Data and Key Metrics Changes - The bituminous coal price was around $105 per tonne, while LNG prices based on JKM were approximately $1,000 per tonne [7] - The generation mix for nuclear power increased due to new nuclear power plants coming online, while coal generation remained stable and LNG generation decreased slightly [7][8] Company Strategy and Development Direction - The company expects an increase in nuclear generation and a decrease in coal generation for 2025, with a maintained LNG mix [8] - The company is closely monitoring interest rate volatility and its impact on short-term corporate bonds, indicating a proactive approach to financial management [13] Management's Comments on Operating Environment and Future Outlook - Management highlighted the need for further investments in the power grid to support renewable energy and stable electricity supply, reinforcing the necessity for tariff increases [19] - The company is exploring opportunities in the U.S. nuclear market and is looking into various options for participation [23] Other Important Information - As of 2025, borrowings stood at KRW 86.1 trillion on a separate basis [9] - The RPS costs for 2025 were KRW 2.876 trillion on a consolidated basis [8] Q&A Session Summary Question: Impact of interest rate volatility on corporate bonds - Management acknowledged monitoring the situation closely but reported no special signs detected yet [13] Question: Introduction of localized marginal pricing - The wholesale pricing system is expected to be introduced in 2025, followed by retail pricing in 2026 [14] Question: Basis for potential electricity tariff increases - Management indicated that the need for investments in grid expansion and achieving greenhouse gas reduction targets would be strong bases for tariff increases [19] Question: Updates on nuclear power projects in the U.S. - Management stated they are exploring various options for participation in the U.S. nuclear market [23] Question: Status of HVDC project and its impact on transmission capacity - The first phase of the HVDC project is expected to be completed by October 2026, providing an additional four gigawatts of transmission capacity [23] Question: Exchange rate volatility and its impact on fuel costs - Management confirmed that they have an open position regarding foreign exchange rates and settle LNG prices based on average exchange rates [34] Question: Future directions for shareholder return policy - Management stated that the dividend policy will consider the net profit of the year, but specific details could not be disclosed at this time [40]