Doosan is well positioned to benefit from an approximately USD250bn nuclear pipeline and the gas turbine upcycle

Overview

This report focuses on Doosan Enerbility's order, revenue, and valuation leverage amid the global new-build nuclear wave and the tight-supply gas turbine cycle. Bernstein believes the company is shifting from traditional businesses such as coal power and seawater desalination toward higher-quality nuclear and gas equipment businesses, with improving order visibility, backlog quality, and margin structure.

Core views

The core views include: first, Doosan has scarce capabilities in manufacturing key components for large reactors and SMRs, making it an important participant in the supply chain for large nuclear equipment such as AP1000/APR1400. Second, the approximately USD250bn nuclear project pipeline brings about KRW67tn of potential equipment contract opportunities for the company, with Europe offering the highest near-term visibility and the U.S. as a later source of upside. Third, gas turbine market demand is strong and capacity is tight, supporting price and margin expansion. Fourth, the rising share of nuclear and gas businesses will drive the company's margins into the low teens by 2028 and support the SOTP target price of KRW100,000/share.

Analysis framework

The report uses a bottom-up review of the nuclear project pipeline, assessing executability based on whether projects have entered stages such as licensing, FEED, financing, ownership, and pre-procurement; it also combines assumptions on global gas turbine supply and demand, Doosan's capacity expansion, orders, and service revenue to form forecasts for orders, revenue, margins, and valuation.

Methodology notes

• Valuation methodsSOTP and DCF

  Sum-of-the-parts valuation and standalone business DCF

  The report bases its valuation on a standalone DCF for Doosan Enerbility, deriving an enterprise value of KRW63tn using an 8% WACC, and applies a 30% discount to the value of Doosan Bobcat, Doosan Fuel Cell, and other investments to arrive at a target price of KRW100,000/share.

• Industry analysisBottom-up project pipeline analysis

  Screening procurable opportunities by nuclear project development milestones

  The report includes only nuclear projects that are already close to equipment contract signing or the pre-procurement stage, rather than all early-stage opportunities, in order to estimate a more executable near- to medium-term TAM.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Doosan Enerbility Co., Ltd

  Core beneficiary

  Strengths

  Possesses heavy nuclear equipment manufacturing capabilities, AP1000 supply experience, a vertically integrated Changwon plant, gas turbine capacity expansion, and potential for high-margin service revenue.

  Weaknesses

  Nuclear project contract signing depends on regulatory approvals, financing, FEED, and government decisions, with a long order realization cycle; current valuation requires future growth delivery to support it.

  Comparison

  Valuation is higher than that of Chinese and Japanese nuclear equipment peers, but the report believes it remains below that of U.S. peers, and that its global footprint plus growth potential in U.S. nuclear power and gas equipment can support a premium.

  Risks

  Project delays, financing uncertainty, execution risk, supply chain bottlenecks, weaker gas turbine demand, and capacity expansion falling short of expectations.

• Global nuclear equipment supply chain

  Source of demand

  Strengths

  Large reactors and SMRs bring long-cycle equipment demand, while suppliers of heavy nuclear components are scarce.

  Weaknesses

  Project approvals, financing, politics, and construction cycles are complex.

  Comparison

  European projects offer stronger near-term visibility, while U.S. projects are later-stage but see improving policy support.

  Risks

  Policy changes, cost overruns, technology pathway shifts, and delayed procurement timing.

• Global gas turbine market

  Growth and margin read-through

  Strengths

  Order demand is expected to rise from 57GW in 2024 to about 100GW in coming years, while current capacity is about 60GW, supporting price and margin.

  Weaknesses

  The industry is expanding capacity, and future supply-demand balance may gradually ease.

  Comparison

  Siemens Energy, GE Vernova, and Mitsubishi Heavy Industries control more than 70% of global capacity, and the expansion of peer margins toward the 20%-25% range is a reference point for Doosan.

  Risks

  New capacity exceeding expectations, demand normalization, changes in gas-fired power policy, and rising project costs suppressing demand.

Key data

• Nuclear project pipelineAbout 35GW, about USD250bn TAMThe report believes these projects are sufficiently close to the pre-procurement or equipment contract signing stage.
• Doosan potential nuclear equipment contractsAbout USD44bn, about KRW67tnDerived from the approximately USD250bn nuclear pipeline.
• Annual order forecastAbout KRW15tn (2025) to about KRW21tn-24tn (end of decade)Different sections of the report cite KRW21tn and KRW24tn respectively, both above the company's roughly KRW16.5tn 2030 target.
• New orders in gas businessKRW4.7tn (2025) to KRW6.9tn (2030)Supported by gas turbine capacity expansion and market demand.
• Gas service revenueAbout KRW0.4tn (2030), about KRW1.1tn (2035)Growth follows the expansion of the installed base of shipped gas turbines.
• Revenue mixNuclear and gas revenue share rises from 41% (2024) to above 75% after 2028Business mix shifts toward higher-margin equipment.
• Standalone revenue forecastKRW14.7tn (2030), 2025-2030 CAGR 13%Above the company's 2030 target of KRW11.3tn.
• Valuation and target priceStandalone DCF enterprise value KRW63tn; target price KRW100,000/shareWACC is 8%, and the SOTP target price includes discounts to subsidiaries and other investments.

Impact & implications

If nuclear projects progress according to milestones and gas turbine demand remains strong, Doosan's valuation logic will expand from the current backlog to the future order pipeline, business mix upgrade, and margin improvement. For investors, the key lies in the pace of order conversion, share of nuclear equipment contracts, gas turbine capacity ramp-up, and the formation of high-margin service revenue.

Risks

• Nuclear projects may see equipment contracts delayed due to regulatory approvals, financing, engineering design, or delays in final investment decisions.
• Whether Doosan can secure the expected share of equipment contracts still faces competitive and execution uncertainty.
• If demand slows after gas turbine market capacity expansion, price and margin improvement may fall short of expectations.
• If the company's capacity expansion, delivery quality, and supply chain management fall short of expectations, order conversion and margins may be affected.
• The target valuation embeds high expectations for future growth and order conversion; if orders or margins disappoint, valuation compression risk will be significant.

What to watch

• Progress on equipment and EPC contract signing for the Poland Lubiatowo-Kopalino AP1000 project.
• The pace of the 2026 FID and 2027 EPC signing for Bulgaria's Kozloduy-7 and Kozloduy-8 projects.
• Implementation progress of the U.S. DOE's USD17.5bn loan program for AP1000 long-lead equipment.
• Execution of Doosan's gas turbine capacity increase from the current 8 units per year to 12 in 2028 and 16 in 2030.
• Whether the nuclear and gas revenue mix exceeds 75% after 2028 as expected, and whether operating margin enters the low teens.
• Whether 2030 backlog can approach the report's forecast of KRW53tn.