HD Hyundai Heavy Industries experienced a 7% surge in trading following the announcement of a major contract to supply power generation equipment for U.S. data centers.
The Korea Exchange reported on Wednesday that HD Hyundai Heavy Industries was trading at 619,000 KRW (about 418 USD) as of 1:40 p.m. (Korean time), marking a 43,000 KRW (about 29 USD) (7.47%) increase from the previous day’s close.
The company disclosed that it had inked a deal with Aperion Energy Group (AEG), a U.S.-based energy infrastructure developer, for the supply of 20MW Hi-rated Medium Speed Engine (HiMSEN) power generation equipment.
This contract, valued at 627.1 billion KRW (about 435 million USD), covers a total capacity of 684MW. It stands as the largest power generation engine contract in HD Hyundai Heavy Industries’ history. The equipment is slated for use in data center power infrastructure, where stable, high-capacity electricity supply is crucial.
This deal marks HD Hyundai Heavy Industries’ debut in the U.S. data center market. The company aims to broaden its business scope, leveraging its Hi-rated engine lineup to tap into various sectors including data centers, industrial power, and emergency and auxiliary power systems.
In the marine engine sector, there are two main categories: two-stroke engines for propulsion and four-stroke engines for power generation and smaller propulsion needs. Four-stroke engines, which complete four reciprocating cycles, offer lower output but excel in efficiency and precise control.
The four-stroke engine’s ability to deliver consistent and reliable power at high revolutions per minute (RPMs) has enabled its expansion beyond maritime applications. It’s now finding use in land-based plants and as distributed power sources fora artificial intelligence (AI) data centers.
For AI data centers, where even minor voltage fluctuations or brief power interruptions can lead to system shutdowns or data corruption, four-stroke engines are emerging as a critical emergency power solution.
Meanwhile, Hanwha Engine Company is reportedly exploring opportunities in the data center sector. The company’s stock traded at 68,300 KRW (about 46 USD), up 7,600 KRW (about 5 USD) (12.71%) from the previous session.
The positive sentiment extended to other industry players, with HD Korea Shipbuilding & Marine Engineering up 6.55%, Daewoo Shipbuilding & Marine Engineering rising 4.78%, Samsung Heavy Industries gaining 4.47%, and Hanwha Ocean advancing 2.29%.