LS Electric pours $180M into US plant as AI power orders top $5B
What's the deal? LS ElectricDealroom has a profile for this one. Try Dealroom → is expanding manufacturing capacity at home and in the US as AI infrastructure investment drives surging demand for power grid equipment. Last month, it approved a US$63.8M investment into its US production subsidiary, LS Electric UtahDealroom has a profile for this one. Try Dealroom →, through intermediate holding company LS Electric Americas HoldingsDealroom has a profile for this one. Try Dealroom →.
Why now? The company's domestic plants are running near full capacity. Its Cheongju plant, which makes low- and high-voltage distribution equipment, hit a 96.4% utilisation rate in the first half of 2025 — above the 90% threshold the industry considers full operation.
What's the endgame? The Utah investment is part of a US$209.6M project to expand the Cedar City plant roughly sixfold, targeting a start of operations in early 2026. Once complete, the Utah unit's annual switchboard capacity will rise to about US$419.2M, with design and R&D functions added to build a self-contained North American production base.
At home, LS Electric completed a second ultra-high-voltage transformer building at its Busan site in December 2024 for about US$84.5M. The expansion lifted the site's transformer capacity from US$167.7M to US$503M a year; the company aims for US$838.4M in annual sales from Busan alone this year.
By the numbers: The company's order backlog topped US$5.87B at the end of the second quarter, fuelled by North American demand for ageing grid replacement and data centre build-outs. After booking more than US$2.52B in new orders in the first half, LS Electric raised its full-year order target from US$3.35B to US$5.45B — a jump of more than 60%.
Data centre power equipment orders from North American big tech reached US$1.01B in the first half, already surpassing the US$670.7M booked across all of last year.
What's next for earnings? Analysts expect third-quarter operating profit of US$157.2M, up 86% from US$84.5M a year earlier, according to FnGuideDealroom has a profile for this one. Try Dealroom →. The market credits higher-margin North American exports and fast revenue conversion from distribution solutions.
Distribution equipment holds a timing edge: ultra-high-voltage transformers take three to four years to deliver, while switchboards for data centres ship in months to about a year. "This reduces market concerns that it could lag the rise in ultra-high-voltage transformer orders," said Shin Dong-hyun, an analyst at Hyundai Motor SecuritiesDealroom has a profile for this one. Try Dealroom →.
The signal: LS Electric is betting that the big-tech-led power infrastructure "super-cycle" will keep running. A company representative called the Utah move "a significant turning point" for strengthening trust and brand recognition in the North American market.
Read more: news.bizwatch.co.kr
Image credit: FirstEnergy Corp.
