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Korea Electric Power

015760 · KOSPI · ₩KEPCO · 한국전력

₩28,600▲ ₩300 (1.06%)End-of-day · Oct 30, 2026 · End-of-day prices.
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Valuation model · Discounted cash flow (DCF)

We use a 5-year discounted cash flow: the value of the cash the business is expected to produce, in today's money.

Fair value per share

With these assumptions the model gives no positive value.

Enterprise value
−₩20T
Equity value
−₩144T
WACC
4.4%

Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal. This is not financial advice.

Why the model and the price differ

The model gives no positive value at these assumptions. What we can see:

  • To match today's price of ₩28,600, the model needs an operating margin of 6.0% every year (it uses 1.7%).
  • Margins ranged from −45.8% to 13.8% over the last 5 years, so this is a cyclical business. The model uses the average; the price may be set by where the cycle is now. Try the margin fade option.
  • In the projection, spending on equipment, software and working capital takes most or all of the after-tax operating profit, so free cash flow is thin. Companies that invest heavily often look like this until spending slows.
  • Today's P/E is 2.3× against a typical 3.7× over the last 10 years.

Treat the model as a starting point: change the assumptions to the story you believe, and compare with the multiples check below.

Bear / Base / Bull

Bear
—
Base
—
Bull
—

Bear: revenue growth 3 points lower every year, EBIT margin 2 points lower, WACC 1 point higher. Bull: the opposite.

Assumptions

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Cycle options

Margin path

Every year uses the cycle-average margin (1.7%).

Revenue growth

  • 11%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11% a year, annual reports), fading to 3% by year 5.

  • 9%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11% a year, annual reports), fading to 3% by year 5.

  • 7%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11% a year, annual reports), fading to 3% by year 5.

  • 5%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11% a year, annual reports), fading to 3% by year 5.

  • 3%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11% a year, annual reports), fading to 3% by year 5.

Business

  • 1.7%

    Operating profit as a share of revenue.

    Default: through-the-cycle average of the last 12 months and the last 5 annual reports' operating margins.

  • 27.5%

    Share of operating profit paid as corporate tax.

    Default: Korea's top corporate tax rate (25%) plus 10% local income tax.

  • 14.5%

    The non-cash cost of wearing out equipment, added back to cash flow (% of revenue).

    Default: average of the last 3 annual reports (cash flow statements; equipment and intangibles).

  • 15.8%

    Money spent on factories, equipment, software and other long-term assets (% of revenue).

    Default: average of the last 3 annual reports (cash flow statements; equipment and intangibles).

  • 7.1%

    Stock and unpaid customer bills, less unpaid supplier bills, as a % of revenue. Each year's extra revenue ties up this much more cash.

    Default: working capital (current assets less cash and deposits, minus current liabilities other than borrowings) as a share of revenue, averaged over the last 3 years.

Discount rate

  • 2%

    How fast cash flows keep growing every year after year 5.

    Default: about Korea's long-run inflation plus real growth.

  • 4.01%

    Yield on Korea's 10-year government bond: the return with almost no risk.

    Default: Korea Treasury Bond 10-year yield on 2026-10-30.

  • 0.6

    How much the share moves when the market moves: 1 means just like the market.

    Default: 105 weeks of weekly returns against KOSPI (official index); raw beta 0.32, adjusted toward 1 and kept between 0.6 and 2.0.

  • 5.5%

    The extra return investors want for owning shares instead of bonds.

    Default: a typical premium for Korean shares.

  • 5.51%

    The interest rate the company would pay to borrow.

    Default: the 10-year yield plus a 1.5% credit spread.

Starting point

Revenue (TTM to H1 2026)
₩98T
Net debt (borrowings and leases − cash and deposits)
₩131T
+ Stakes and investments
₩7.2T
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩1.2T
Shares
641,964,077
Share price
₩28,600
Market cap
₩18T

TTM = trailing 12 months: the last four reported quarters added together. "TTM to H1 2026" is the 12 months up to the latest quarterly or half-year report (H1 = to the end of June). Year 1 grows from there.

Past years and projection

Grey columns are reported results from the annual reports (after-tax EBIT at the model's tax rate), so you can check the growth and margin assumptions against the past. Years 1–5 are the model.

FY2023FY2024FY2025Year 1Year 2Year 3Year 4Year 5
Revenue₩88T₩93T₩97T₩108T₩118T₩126T₩133T₩137T
Growth23.8%5.9%4.3%11.0%9.0%7.0%5.0%3.0%
EBIT−₩4.5T₩8.4T₩13T₩1.8T₩2T₩2.1T₩2.3T₩2.3T
EBIT margin−5.1%9.0%13.8%1.7%1.7%1.7%1.7%1.7%
After-tax EBIT−₩3.3T₩6.1T₩9.8T₩1.3T₩1.5T₩1.6T₩1.6T₩1.7T
+ Depreciation₩13T₩14T₩14T₩16T₩17T₩18T₩19T₩20T
− Capital spending₩14T₩14T₩16T₩17T₩19T₩20T₩21T₩22T
− Working capital₩383B₩2.3T−₩63B₩762B₩692B₩587B₩448B₩283B
Free cash flow−₩4.8T₩3.3T₩7.5T−₩835B−₩772B−₩672B−₩538B−₩375B
Discount factor———0.9580.9170.8790.8420.806
Present value———−₩800B−₩708B−₩591B−₩453B−₩302B

Terminal value −₩21T, worth −₩17T today: 85% of enterprise value. It assumes spending settles at 110% of depreciation once growth slows to the terminal rate.

Cross-check: what the market has paid before

For cyclical businesses, analysts check a DCF against the multiples the stock has traded at through past cycles. Price / book is the usual anchor for them: P/E looks highest at the bottom of a cycle, when earnings are smallest, and lowest at the top. The price each band would give today:

LowTypicalHigh
Price / book (book value ₩78,939 a share)Now 0.36×₩17,9990.23×₩27,5260.35×₩46,5610.59×
Price / earnings (last 12 months: ₩12,213 a share)Now 2.34×₩31,3262.57×₩45,2503.71×₩68,2575.59×
P/E on run-rate earnings (Q2 2026 × 4: ₩1,666 a share)Now 17.2×₩4,2722.57×₩6,1713.71×₩9,3095.59×

Low, typical and high are the 10th percentile, middle and 90th percentile of month-end multiples since 2021, each against the latest report out by then, per share at today's share count; loss years and P/E above 100 are left out. Run-rate earnings are one quarter × 4, not a forecast. Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Sensitivity

Fair value per share as two inputs change; the middle is the current case.

WACC ↓ · Terminal growth →1.0%1.5%2.0%2.5%3.0%
3.4%—————
3.9%—————
4.4%—————
4.9%—————
5.4%—————

Now (TTM)

Market cap
₩18T
Enterprise value
₩149T
P/E
2.3×
P/B
0.4×
P/S
0.2×
EV/EBITDA
5.7×
Dividend yield
5.4%

Over time (at each year end)

20252024202320222021
Price₩47,200₩20,050₩18,900₩21,800₩22,100
Market cap₩30T₩13T₩12T₩14T₩14T
P/E3.5×3.7×———
P/B0.6×0.3×0.3×0.3×0.2×
P/S0.3×0.1×0.1×0.2×0.2×
EV/EBITDA5.8×6.5×17.0×—15.6×
Dividend yield3.3%1.1%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Korea Electric Power2.3×0.4×0.2×5.7×5.4%
Korea Gas6.0×0.3×0.1×8.6×3.1%
Korea District Heating2.3×0.3×0.2×4.8×8.8%
SGC Energy—0.6×0.2×—4.3%
Samchully3.2×0.2×0.1×—2.5%
Seoul City Gas11.4×0.2×0.1×—0.0%
Daesung Energy6.5×0.5×0.2×—3.6%
Similar companies (median)6.0×0.3×0.2×6.7×3.4%

Calculated from end-of-day prices and filed financial statements. Not a recommendation. This is not financial advice.

Also known as: Korea Electric Power / 한국전력 / 015760 / KRX:015760

Source: KRX statistical information