By Kwanwoo Jun


Korea Electric Power Corp.'s shares slumped Monday, after what analysts described as an insufficient electricity-tariff increase.

Shares in the South Korean state utility fell 11% to close at 19,350 won ($15.33), the steepest daily decline since the 2008 financial crisis. The benchmark Kospi closed 0.5% lower.

The stock's plunge followed the Seoul government's Dec. 30 decision to raise tariffs by KRW13.1 per kilowatt hour in South Korea from Jan. 1, 2023, aiming to help the company make up for snowballing losses caused by recent years of surging costs for fuel purchases.

The latest tariff increase, however, won't be enough for the utility to turn around, SK Securities analyst Na Min-sik said in a note Monday.

The company, which is likely to post an operating loss of KRW29 trillion in 2022 following a KRW5.89 trillion loss in 2021, would need a tariff increase of KRW51.6 per KWh to swing to profit, Mr. Na said.

Meritz Securities analyst Moon Kyeong-won said in a research note Monday that he expects the firm's operating loss could narrow to KRW4.95 trillion in 2023 from an estimated KRW31 trillion in 2022.


Write to Kwanwoo Jun at kwanwoo.jun@wsj.com


(END) Dow Jones Newswires

01-02-23 0222ET