Table of Contents
Core of Kiwoom Power TOP5 ETN
Kiwoom Power TOP5 ETN, which was listed on February 24, 2026, is an investment product consisting of five important companies in the domestic power equipment value chain. The companies include Korea Electric Terminal, LS, LS ELECTRIC, HD Hyundai Electric, and Hyosung Heavy Industries.
Recently, the power equipment industry has shown remarkable growth in the global market. This is due to increased investment in AI data centers, which structurally raises power demand, leading to an increase in orders for transmission and distribution facilities, ultra-high voltage transformers, and wires, resulting in a prolonged supply bottleneck. This phenomenon reflects the typical flow of a supercycle.
Recently in North America, the lead times for transformers, switchgear, and ultra-high voltage cables have lengthened, increasing price-setting power. This is driving improvements in company performance and rising multiples.
At this point, what is critical is not just simple performance improvement but the visibility of performance being secured through increased order backlog. This contributes to forming a positive premium on stock prices.
Performance and Supercycle
The fourth-quarter performance of the constituent stocks showed overall impressive results.
HD Hyundai Electric recorded an operating profit margin of 27% in the fourth quarter, indicating that its profit levels are structurally high as it maintains high margins.
Hyosung Heavy Industries achieved a margin in the 20% range due to increased overseas orders in the ultra-high voltage sector.
LS ELECTRIC is reporting better-than-expected performance due to increased demand from data centers and the North American market.
Korea Electric Terminal is showing a trend of improved profitability due to an increased proportion of revenue from ultra-high voltage and underwater cables.
Lastly, LS is positioned to benefit from the reevaluation of the value chain through its holding company role.
According to the forecast for Q1 26E, profit levels are expected to remain high, though growth is anticipated to slow. This indicates that the power equipment supercycle is not a short-term phenomenon but has become a structural trend.
| Stock | 4Q25 Performance Flow | 1Q26E Forecast | Investment Points | Main Risks |
| HD Hyundai Electric | Quarterly best performance, operating profit margin of over 27% | Sales and profits maintained at high levels | North America high-margin mix, performance visibility based on order backlog | Recovery of pricing power, supply and quality issues |
| Hyosung Heavy Industries | Expansion of overseas ultra-high voltage orders, double-digit margins | Profit defense despite seasonal slowdown | Continuing high-margin orders in North America and Europe | Variability in construction sector, currency and tariff variables |
| LS ELECTRIC | Exceeding consensus, driven by data center demand | Profit maintenance despite revenue adjustments | Strength of power infrastructure revenue, North American demand | Compression of multiples upon alleviating bottlenecks |
| Korea Electric Terminal | Significant profit increase from ultra-high voltage and submarine cables | Normalization expected after 4Q peak | Continuing recognition of high-margin project revenue | Raw material (copper) fluctuations, low-margin mix |
| LS | Benefiting from improved performance of subsidiaries | Forecast for improvement in consolidated profits | Proxy for power value chain holdings | Multiple contraction of subsidiaries, holding company discount |
Leverage and Inverse Strategy
Kiwoom's Power TOP5 ETN can also be utilized along with leverage and inverse 2X strategies beyond its basic form.
The leverage strategy is suitable for maximizing profits during phases of economic growth when performance improves and multiples expand. However, one should be cautious as volatility may increase when growth slows in high-peak periods.
On the other hand, the inverse 2X strategy is useful for preparing for short-term adjustments when multiples become overheated. It should be noted that adjustments can occur even without a slowdown in performance, simply due to the normalization of growth rates.
The power equipment sector is primarily affected by adjustments caused by slowing investment speed, alleviating supply bottlenecks, and recovering pricing power, rather than a collapse in business conditions. In such situations, leverage and inverse strategies can serve as effective short-term response tools.
Investment Risk Assessment
The current risks can be seen more as valuation pressures than business deterioration.
If high margins are maintained long-term, there is a possibility of recovering customer negotiating power, and if supply normalizes, price-setting power may weaken. Moreover, there are concentration risks regarding specific regions or customers, and due to the characteristics of ETNs, the credit risk of the issuer should also be taken into account.
For these reasons, Kiwoom's Power TOP5 ETN can become an efficient investment product if the direction is correct; however, one must be mindful that high concentration in the stocks could lead to significant volatility.
Conclusion of Power ETN Investment
Kiwoom Power TOP5 ETN is a financial product that effectively reflects the supercycle of power equipment.
If the expansion of AI data centers and the increase in global power infrastructure continue, structural growth potential still exists. However, leverage strategies are only effective when performance continues to grow rapidly, while the inverse 2X strategy is advisable to use when there is high valuation pressure.
Ultimately, the potential for further increases depends on the upward adjustment of performance and maintenance of orders and margins. During the supercycle phase, price declines could act as opportunities, but thorough risk management is essential during overheating periods.
#PowerTOP5ETN, #KiwoomETN, #PowerEquipmentStocks, #HDHyundaiElectric, #HyosungHeavyIndustries, #LSELECTRIC, #KoreaElectricTerminal, #LSHoldings, #PowerSupercycle, #AIDataCenters, #TransmissionDistributionFacilities, #UltraHighVoltageCables, #Transformers, #Switchgear, #CableStocks, #PowerEquipmentStocks, #LeverageETN, #Inverse2X, #PowerInfrastructure, #DataCenterPower, #NorthAmericanPowerInvestment, #OrderBacklog, #OperatingProfitMargin, #PowerValueChain, #HoldingCompanyProxy, #PowerThemeStocks, #StockMarketOutlook, #ETFETNInvestment, #DomesticPowerStocks, #SupercycleInvestment
Frequently Asked Questions (FAQ)
Q. What companies make up the Kiwoom Power TOP5 ETN?
Kiwoom Power TOP5 ETN is made up of five companies: Korea Electric Terminal, LS, LS ELECTRIC, HD Hyundai Electric, and Hyosung Heavy Industries.
Kiwoom Power TOP5 ETN is an investment product that was listed on February 24, 2026, consisting of five important companies in the domestic power equipment value chain. The constituent stocks include Korea Electric Terminal, LS, LS ELECTRIC, HD Hyundai Electric, and Hyosung Heavy Industries, with each company actively engaged in key areas related to power equipment.
Q. What market situation and supercycle are currently occurring in the power equipment industry?
A supercycle is underway in the power equipment industry due to increased investment in AI data centers, resulting in higher power demand and equipment orders.
Recently, in the global market, the expansion of AI data center investment has structurally increased power demand. This has led to a surge in orders for transmission and distribution facilities, ultra-high voltage transformers, and wires, causing a prolonged supply bottleneck and forming a typical supercycle flow. In North America, the lengthening lead times for transformers, switchgear, and ultra-high voltage cables are increasing pricing power, leading to improvements in corporate performance and stock price multiples.
Q. How can the leverage and inverse 2X strategies of Kiwoom Power TOP5 ETN be utilized?
Leverage is used to maximize profit in growth phases, while inverse is used as preparation for adjustments during overheating of multiples.
The leverage strategy is suitable for maximizing profits when performance improves and multiples expand during economic growth, but volatility may increase when growth slows at higher peaks. The inverse 2X strategy is useful in preparing for short-term adjustments due to overheating multiples, and it should be noted that adjustments can occur even without a slowdown in performance, just from the normalization of growth rates. The adjustment factors in the power equipment sector involve controlling investment speed and supply expansion, and these strategies can be efficient short-term response measures.
Q. What are the main risk factors when investing in Power TOP5 ETN?
Valuation pressure, customer concentration risk, and issuer credit risk are major investment risks.
The current risk factors can be viewed more as valuation pressures rather than business deterioration. Over the long term, if high margins are maintained, there could be a recovery in customer negotiating power, reducing the ability to set prices as supply normalizes. Additionally, there are concentration risks related to specific regions or customers, and the credit risk of the issuer cannot be ignored due to the nature of ETNs. Therefore, careful risk management is necessary as high concentration in stocks may lead to significant volatility.
Q. What are the investment conclusions and outlook for Kiwoom Power TOP5 ETN?
It reflects the supercycle of power equipment, and maintaining performance and orders is key to rise, while risk management is essential.
Kiwoom Power TOP5 ETN is a product with structural growth potential due to the expansion of AI data centers and growth in power infrastructure. The leverage strategy is only effective when there is a rapid increase in performance, while the inverse 2X strategy is suitable for mitigating valuation pressure. Further increases depend on performance upgrades and the maintenance of orders and margins, with price declines during the supercycle being potential investment opportunities; however, thorough risk management is crucial during overheating phases.