[Click eStock] "BHI, Potential Beneficiary of SMR Highlighted"

On the 26th, KB Securities analyzed that BHI's continuous progress in its core business and the potential benefits from Small Modular Reactors (SMR) are being highlighted.

BHI is a company engaged in power generation equipment business necessary for power plant processes and steelmaking processes. It is capable of handling all areas including design, manufacturing, installation, and construction. The company also operates in the nuclear power plant auxiliary equipment business and holds references from past deliveries to Westinghouse and Korea Hydro & Nuclear Power (KHNP).

Han Jeyoon, a researcher at KB Securities, stated in a report on the same day, "BHI's expected performance this year is sales of 374.1 billion KRW and operating profit of 20.3 billion KRW, representing increases of 1.8% and 34.8% respectively compared to the previous year." He added, "Projects ordered from the end of last year to early this year have started to be reflected in the results, leading to quarterly performance improvements, and this trend is expected to continue into 2025 considering the scale of new orders this year."

This year, BHI's new orders exceed 1.3 trillion KRW, more than 10 times the previous year, setting a record high (previous record approximately 830 billion KRW). Considering the project duration, these will be reflected in sales over the next 2 to 2.5 years.

The researcher forecasted, "Considering existing orders, new orders, and nuclear-related sales, the 2025 performance is expected to record sales of 544.1 billion KRW (+45.4% year-on-year) and operating profit of 30.6 billion KRW (+50.4% year-on-year)."

The sector showing a rapid increase in orders is the HRSG (Heat Recovery Steam Generator) for LNG plant facilities. LNG plants serve as a bridge in the transition to renewable energy, and demand is increasing globally.

He said, "Accordingly, demand for the core equipment HRSG is also increasing, driving BHI's surge in orders," and added, "Considering the scale of new projects planned in markets where BHI is strong, such as the Middle East, Korea, and Japan, orders exceeding 1 trillion KRW are expected in 2025 as well."

He also analyzed that since SMRs are not structurally very different from large nuclear power plants, there is no reason why BHI, a strong player in existing nuclear auxiliary equipment, would not benefit from the SMR market development.

He added, "BHI is registered as an auxiliary equipment vendor for NuScale Power, making it possible to generate sales related to overseas SMR companies," and "Although the timing cannot be predicted, it is important to pay attention to the fact that the opening of the SMR market is likely to become a growth driver for BHI."