Signs of U.S. Wind Market Emerging from Slump… CS Wind Rebound Expected

The landscape of the U.S. wind market is shifting. As competitors make successive exits and signs of easing permitting barriers emerge, DS Investment Securities predicts these changes will act as a catalyst for the performance rebound of domestic tower manufacturer CS Wind.

DS Investment Securities stated that Broadwind has effectively withdrawn its tower business from the wind market this year, and Arcosa is also showing signs of converting facilities or scaling back its wind power operations. The firm revealed that due to these changes, the U.S. tower market's supply capacity is estimated to have shrunk by approximately 30%, falling from 10GW to the 7GW range. CS Wind holds production capacity of 4-5GW in the U.S. DS Investment Securities analyzes that if demand recovers, there is room for order expansion based on the market vacancy left by competitors.

The permitting environment is also changing. Until now, various permitting delays in the U.S. have acted as stumbling blocks for new business ventures. Recently, a U.S. court ruled that the Trump administration's freeze on wind energy project permits was unlawful. DS Investment Securities estimated that the scale of projects stalled due to permit denials by the Department of Defense amounts to approximately 30GW. The firm analyzed that if permitting issues are resolved, stalled projects will resume, and as projects move to the construction phase, demand for related parts such as turbines and towers will increase.

DS Investment Securities issued a 'Buy' rating and a target price of KRW 81,000 for CS Wind.