[Click eStock] "Dawoo Technology, Growing Data Center Sales Gradually"

Daishin Securities forecasted on the 23rd that sales toward data centers for Daou Technology will gradually increase.

Daou Technology is composed of sectors such as Communication, Commerce, Business Infrastructure, and Financial IT. The main sectors are Financial IT, which provides IT infrastructure services to Kiwoom Securities and others, and the Business Infrastructure sector, which includes Daou Office and data center sales. When Kiwoom Securities' IT demand increases, the performance improves accordingly.

Park Jang-wook, a researcher at Daishin Securities, explained in a report on the same day, “Daou Technology has executed an investment of 379 billion KRW to build the Daou Cloud Data Center in Yongin, Gyeonggi Province,” adding, “The operating rack scale is expected to be 3,000 to 4,000 racks, which is 5 to 6 times more than the existing 650 racks (sales of 14.3 billion KRW, operating profit of 4.2 billion KRW).” He further noted that although the data center was scheduled to be completed by June 2025, the completion date may be delayed due to approval delays.

He analyzed, “With an evaluation amount of 17 trillion KRW in securities holdings such as Kiwoom Securities, Korea Information Certificate, Kiwoom E&S, and Saramin, the market capitalization is cheap compared to the assets held. The discount rate of Daou Technology’s market capitalization compared to Kiwoom Securities’ market capitalization is currently 74%, which is the highest historical discount rate since 2011, and the price-to-book ratio (PBR) is also at a historically low level of 0.3 times.”

He also explained, “In the case of Financial IT, the brokerage sales of Kiwoom Securities do not increase proportionally, but IT demand increases as brokerage and other activities of Kiwoom Securities increase, resulting in growth.”

He added, “Since data center rack sales consist of retail and wholesale, it is difficult to estimate that sales will increase proportionally just because the number of racks increases.”