Daihan Electric Wire 001440 Analysis — Record Quarterly Earnings and Valuation

Daihan Electric Wire (001440) In-Depth Analysis: Record Quarterly Earnings and Ultra-High-Voltage & Submarine Cable Competitiveness

Daihan Electric Wire (001440) achieved record quarterly results in 1Q26, with consolidated revenue of KRW 1,083.4B (≈$723.1M) and operating profit of KRW 60.4B (≈$40.3M). The order backlog reached KRW 3,827.3B (≈$2.6B), setting a new all-time high. At the current share price of KRW 60,000 (≈$40.1), Forward PER stands at 121.0x and PBR at 6.96x.

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1. Company Overview and Core Business

Daihan Electric Wire (001440) is a specialized wire and cable company established in 1955, operating four business segments: Extra High Voltage (EHV) & Submarine Cables, Industrial Wire (MV/LV), Materials & Others, and Telecom Cables. The company's largest shareholders are Hoban Industries and two others, collectively holding a 41.98% stake, with overseas sales and manufacturing operations in the Americas, Canada, and other regions. New orders in Q1 2026 totaled 7,339억원 (≈$489.9M), up 108.7% year-over-year, while the order backlog reached an all-time high of 3조 8,273억원 (≈$2.6B). Annual revenue grew 10.5% from 3조 2,913억원 (≈$2.2B) in 2024 to 3조 6,360억원 (≈$2.4B) in 2025, with 2025 operating profit of 1,286억원 (≈$85.8M) (OPM 3.5%).

📌 Q1 2026 order backlog of 3조 8,273억원 (≈$2.6B) — consecutive all-time highs

2. Competitiveness Analysis of Core Products

The EHV & Submarine Cable segment reported revenue of 2,062억원 (≈$137.7M) in Q1 2026, up 80.2% year-over-year. Concentration of high-margin projects drove the company-wide operating margin to 5.6%, a marked improvement from 3.5% in both 2024 and 2025. The EHV & Submarine segment's share of total revenue is projected to expand from 19.1% in 2025 to 26.2% in 2027.*1 Upon commencement of full production at the second submarine cable plant in 2028, that facility alone is expected to add annual revenue capacity of approximately 1조원 (≈$667.6M).*2 The company demonstrated EPC capabilities — from 154kV submarine cable material supply through installation — via the Bigeum Island solar project, and holds a product lineup covering 320kV to 525kV HVDC cables.

Category	Details
Position	Major domestic supplier of EHV & submarine cables; actively diversifying orders across North America, Europe, and Southeast Asia
Competitive Advantages	Proven EPC capabilities (Bigeum Island solar turnkey project), product lineup covering 320–525kV HVDC cables, second submarine cable plant under expansion
Competitive Disadvantages	Operating margin of 4–6%, below global peers Prysmian (2025: 9.7%) and Nexans (2025: 7.2%)

3. Valuation Analysis

Based on the current share price of KRW 60,000 (≈$40.1), the Trailing PER is 132.7x (based on 2025 EPS of KRW 452 (≈$0.30)), and the Forward PER is 121.0x; the lower Forward versus Trailing ratio reflects the directional improvement in EPS. However, this implies a 2–3x premium over domestic peers Iljin Electric (2026F PER 60.8x) and LS Eco Energy (2026F PER 39.5x)*3. PBR stands at 6.96x, elevated relative to the 2026F BPS of approximately KRW 8,572 (≈$5.7)*4. 2025 ROE is approximately 5.5%, a significant gap versus the capital efficiency threshold implied by the current PBR multiple. Pre-tax income in Q1 was negative due to mark-to-market losses on convertible bond derivatives; however, with the conversion of those bonds now complete, similar items will no longer impact pre-tax income going forward.

📌 Forward PER 121.0x — the premium over domestic peers (39–61x) hinges on visibility into the second subsea cable plant and Vietnam capacity expansion

Metric	Current	Domestic Peer Reference*3	Interpretation
Trailing PER	132.7x	25–51x	Net income distorted by convertible bond derivative losses
Forward PER	121.0x	39.5–60.8x	Premium structure vs. peers — reflects medium- to long-term capacity expansion
PBR	6.96x	4.4–8.7x	Exceeds target implied by 2026F BPS of KRW 8,572 (≈$5.7), pricing in 2028F growth

4. Risk Factors and Monitoring Points

Quarterly project mix shifts are expected to drive the Q1 high-margin rate of 5.6% down to 4.1–4.5% in Q2*1. A decline in LME copper prices would directly impact materials segment profitability; low hedge ratios leave the company with high exposure to external variables. Delays to the Vietnam 400kV ultra-high-voltage plant (scheduled 2027 start-up) or the second subsea cable plant (scheduled 2028 mass production) would introduce uncertainty into the medium- to long-term revenue capacity plan.

• ⚠️ LME copper price decline would erode materials segment profitability — low hedge ratio means direct exposure to external variables
• ⚠️ High-margin project concentration in 1Q26 creates a base effect — analysis indicates operating margin declining more than 1%p in 2Q26

• 📌 Quarterly operating margin — whether it holds above 5% (2Q26F consensus: 4.1–4.5%)
• 📌 Order backlog trend — quarterly direction relative to KRW 3.8273T (≈$2.6B), currently at an all-time high

5. Recent DART Disclosures

The decision to acquire a dedicated submarine cable-laying vessel, disclosed in May 2026, is an asset acquisition announcement aimed at strengthening submarine cable installation capabilities and value chain competitiveness. Q1 2026 consolidated preliminary results were disclosed, reporting operating profit of 604억원 (≈$40.3M) (OPM 5.6%), a record high on a quarterly basis.

날짜	공시명	요약
2026-05-15	Decision to Acquire Submarine Cable-Laying Vessel	Acquisition price of 1,154억 4,325만원 (≈$77.1M), scheduled acquisition date of August 15, 2026. Decided for the purpose of strengthening installation capabilities and value chain competitiveness through the additional acquisition of a submarine cable-laying vessel.
2026-04-30	Q1 2026 Consolidated Preliminary Earnings Disclosure	Revenue of 1조 834억원 (≈$723.2M) (YoY +26.6%), operating profit of 604억원 (≈$40.3M) (YoY +122.9%, OPM 5.6%), achieving a record quarterly operating profit. Includes new orders of 7,339억원 (≈$489.9M) (YoY +108.7%).

Daihan Electric Wire confirmed its profitability improvement trend in concrete figures with 1Q26 record quarterly results. The key variables for future performance are adherence to the commissioning schedule for Submarine Cable Plant No. 2 and the Vietnam ultra-high-voltage facility, and maintaining the proportion of high-margin project orders.

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📎 출처 및 추정 근거

1. ^*1 2027F ultra-high-voltage and submarine cable revenue mix of 26.2% and 2Q26F operating margin of 4.1–4.5% — estimates based on Yuanta Securities and Hana Securities Company Report dated 2026-04-30
2. ^*2 Submarine Cable Plant No. 2 standalone annual revenue CAPA of approximately KRW 1T (≈$667.6M) — based on Yuanta Securities Company Report dated 2026-04-30 and the company's mid-to-long-term CAPA plan disclosures
3. ^*3 Domestic peer 2026F PER — Iljin Electric 60.8x, LS Eco Energy 39.5x: based on Yuanta Securities Peer Valuation Table dated 2026-04-30. Market capitalization as of closing price on 2026-04-29.
4. ^*4 2026F BPS KRW 8,572 (≈$5.7) — based on Hana Securities estimated financial statements dated 2026-04-30. PBR at current share price of KRW 60,000 (≈$40.1) = approximately 6.99x (6.96x based on input data).
5. ^*5 USD equivalents (≈$) are approximate, calculated at 1 USD = 1,498 KRW (as of 2026-05-16, source: Yahoo Finance via TradeAlert).

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