[Click eStock] "Doosan Fuel Cell, Sales Expected to Increase in the Second Half... Target Price Up"

Target Price Raised by 12.5% Compared to Previous Level

NH Investment & Securities raised the target price for Doosan Fuel Cell from 24,000 KRW to 27,000 KRW on the 11th, anticipating increased sales in the second half of the year. The investment rating was maintained at 'Buy.'

Researcher Jeong Yeonseung of NH Investment & Securities explained, "The target price was calculated by applying a price-to-sales ratio (PSR) of 5.1 times, which is the average for global power generation fuel cell companies and EPC (Engineering, Procurement, and Construction) firms, to the 2024 sales forecast." He added, "We raised the target price by 12.5% compared to the previous one, reflecting the recent increase in electricity demand and the upward revision of valuations for peer companies due to fuel cell demand expectations centered in the United States."

The short-term growth factor is analyzed to hinge on the results of bids in the domestic general hydrogen and clean hydrogen power generation markets scheduled for the second half of the year. Researcher Jeong stated, "The general hydrogen power generation market, which is about 1300 GWh annually, holds one bidding round per year, and the domestic fuel cell market is expected to form a market of about 170 to 180 MW annually." He added, "The selection of successful bidders for new fuel cell projects is expected in August to September this year, and Doosan Fuel Cell is anticipated to secure new orders exceeding 100 MW based on a market share of over 60%." The clean hydrogen power generation market, with a scale of 6500 GWh, will hold bidding in November this year, with project operators to be selected in December. Researcher Jeong noted, "Although it can be partially used as backup power for data centers, it is not a short-term demand growth factor," and emphasized, "In the domestic market, demand growth through bidding in the general hydrogen and clean hydrogen markets is important."

Fuel cell sales are expected to resume from the second quarter of this year. NH Investment & Securities estimates Doosan Fuel Cell's second-quarter earnings at 62.3 billion KRW in sales, a 26.7% increase year-on-year, and operating profit of 1.3 billion KRW, a 165.9% decrease. Researcher Jeong forecasted, "With maintenance sales exceeding 30 billion KRW per quarter and fuel cell equipment sales also reflected, sales are expected to increase as we move into the second half of the year."