[Featured Stock] Jeryong Electric, Transformer Price Index Hits 'All-Time High' with AI Growth... The Only Listed Company with 100% Distribution Transformers

Jeryong Electric is showing strong performance. Securities firms' analysis that transformer demand is increasing due to advancements in artificial intelligence (AI) technology and the expansion of data centers appears to be influencing the stock price.

As of 9:23 AM on the 8th, Jeryong Electric was trading at 32,150 KRW, up 2,800 KRW (9.54%) compared to the previous trading day.

Founded in 1986, Jeryong Electric is a specialized manufacturer of distribution transformers. Distribution transformers account for 100% of its sales, making it the only listed company in this sector.

Researcher Son Hyun-jung from Yuanta Securities explained, "According to the IEA, global data center electricity consumption is expected to nearly double from 460 TWh in 2022 to between 620 and 1,050 TWh by 2026." He added, "The increase in energy consumption in the U.S., which accounts for 33% of global data centers, is expected to be even more pronounced," and "Morgan Stanley also forecasts that generative AI will account for more than 75% of global electricity demand by 2027."

He emphasized, "This directly leads to increased demand for power transformers," noting that "Jeryong Electric's sales surged from 48.8 billion KRW in 2021 to 183.9 billion KRW in 2023, achieving approximately fourfold growth over two years."

Researcher Son analyzed, "Jeryong Electric's export ratio increased significantly from 25% in 2021 to 80% in 2023," and "the current order backlog is expected to be maintained at over 300 billion KRW."

He also explained, "The transformer supply shortage is expected to be prolonged," citing "the difficulty of rapidly expanding production capacity in the short term." He added, "The upward trend in export unit prices continues," noting that "in January this year, the U.S. transformer producer price index reached 343.8, setting a historic record high."

It is estimated that this year’s sales will reach 248 billion KRW and operating profit 94.7 billion KRW, representing increases of 34.8% and 35.0%, respectively, compared to last year. The operating profit margin is expected to exceed 38%.