Shinhan Investment said May 4 it raised its target price for DL E&C to 130,000 won from 120,000 won, citing profitability that outpaces peers and higher earnings estimates. It maintained its “buy” rating.
Kim Seon-mi, an analyst at Shinhan Investment, said DL E&C’s first-quarter operating profit “far exceeded” the market consensus as profitability improved in its housing and plant businesses, despite a selective order-taking strategy. “A shift toward profitability over scale has been proven in results,” she said.
Kim said the company posted strong margins without one-off gains, including a 20% gross profit margin in housing and 9.8% in the plant business, above the industry average. She added that earnings capacity is strengthening as DL Construction stabilizes.
She said that despite an uncertain external environment, the company’s order backlog is high quality, improving visibility for future results, and that Shinhan raised its operating profit forecasts for 2026 and 2027.
Kim said expanded orders centered on power infrastructure could support results in the near term, while new growth drivers such as small modular reactors, or SMRs, could add momentum over the medium to long term. She said upgraded earnings estimates should ease valuation pressure and help support the stock’s downside.
* This article has been translated by AI.
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