Good afternoon. We are now going to begin the conference call for POSCO International. Thank you for joining us. There will be a presentation by POSCO International, and then there will be a Q&A session, and if you're going to ask questions, please press Star, Mark, and press one. We'll now begin the earnings presentation for Q4 2024 of POSCO International. Good afternoon. I am telling you that we are now going to begin Q4 2024 earnings presentation. Earnings materials are available in the IR section at POSCO International's site. Today's presentation is conducted via conference call with participants from both Korea and abroad. We provide simultaneous interpretation service. Let me now introduce the management team attending today's conference call. We have with us Lee Kye-In.
We also have Head of Planning Kim Dong-Yeon, Head of Business Management Park Jong-Bin, Head of Rolled Steel and Semiproduct An Ju-Yon g, Head of Mobility Business Kim Young-Il, Head of Industrial Material Business Lee Seong-Soo, Head of Energy Policy Group Kim Gwon-Jung, Head of Low Carbon Energy Business Kim Dae-Hyung, Head of Power Business Kim Dae-Yeon, Head of LNG Business Hwang Eui-Yong, Head of Energy Operation Kwon Chul, and Head of ENP Business Kim Dong-Il. Head of Secondary Battery Mineral Group Kim Jae-Heung, Head of Maintenance Business Development Group Park Sang-Min, and Head of Terminal Business Shin Seung-Jun are also present, and we also have Shin Eun-Ju in attendance. First, our CFO, Mr. Jeong Yeon-In, will deliver opening remarks.
Then I will present the company's 2024 performance, key business updates, and 2025 outlook. Lastly, we will have a Q&A session. Now I will hand it over to our CFO for his remarks.
Good afternoon. I am Jeong Yeon-in, CFO and Head of Business Planning at POSCO International. First, on behalf of the company, I'd like to express my deepest gratitude to all analysts and investors for taking the time to join today's presentation. I also sincerely appreciate the trust and interest you have shown us over the past year. The year 2025 is the year of the Blue Snake, a symbol of wisdom, growth, and prosperity. These qualities align closely with the values we aim to pursue this year. Building on last year's momentum, we are fully prepared to embrace new challenges through innovation and progress. Just like the agility and resilience of the Blue Snake, POSCO International will swiftly adapt to the evolving market landscape and drive sustainable growth. Today's session is an opportunity to share our vision and strategies with you as we shape a bright future together.
Once again, thank you for your participation. I hope the year of the Blue Snake brings you all good health and great fortune. Now, let me briefly outline the company's key activities in 2024 and our plans for 2025. Looking back on last year's achievements, despite heightened uncertainties such as global geopolitical instability, we remained focused on building a foundation for sustainable growth. Guided by our mission to create, connect, and complete businesses, we successfully implemented our strategic initiatives across all business areas without disruption. Additionally, we executed our planned investment of KRW 1.1 trillion, laying a solid foundation for future growth by business area. The energy business further strengthened its LNG full value chain, which was completed through the merger.
In the upstream, we completed the development of phase three of the Myanmar gas field and started the development of a further phase four, as well as continuing the expansion of the Senex's production system. In midstream, we successfully completed the construction of the sixth LNG storage tank and commenced commercial production, contributing to a stable supply of LNG. On the downstream side, we reached an important milestone in November by receiving conditional approval for the modernization of units three and four of the Incheon Power Plant, an important step in advancing our power generation business. In the material business, we expanded into future growth businesses with key achievements such as investing in graphite mine in Tanzania and breaking ground on palm oil refining plant in Indonesia. Additionally, we introduced our brand identity, seeking answers on a global scale, which reflects the essence of our business.
To align brand value enhancement with corporate value growth, we also presented our corporate value enhancement plan to the market, outlining our strategic direction and midterm goals. Looking ahead to 2025, while uncertainties are expected to increase due to monetary policy shifts and heightened financial market volatility, we see this not as a crisis but as a great opportunity. With a strong and well-balanced business portfolio, we are committed to achieving sustainable growth. To achieve growth, first in energy, we will leverage our unique full LNG value chain to create synergies. We support the successful development of the upstream business, including the fourth phase of the Myanmar gas field development and the triple expansion of the Senex in Australia, as well as investments to secure additional reserves through new exploration and development.
We will also drive the expansion of related businesses through the acquisition of overseas gas production assets or companies. In midstream, we will support timely completion of the seventh and eighth storage tanks and increase the profitability of terminal-related businesses by increasing the share of PTS bunkering and improving the profitability of import-export operations. We will focus on ensuring timely implementation of the downstream units three and four, which are new challenges, and securing opportunities for new energy businesses in domestic collective energy and ICI such as Vietnam to strengthen our power generation portfolio. Second, we will build on our unique capabilities in materials business to add value to the group's businesses. For mobility business, we will continue to establish overseas production bases, focusing on efficiency and future growth potential.
By differentiating its competitiveness through a product packaging market with group companies such as POSCO Future M , we aim to develop into a flagship synergy business for the group. In agri business, we will continue to expand our value chain by acquiring new palm plantations and investing in refining. We will also proactively prepare for the post-Russia-Ukraine conflict to secure new business opportunities. In the steel business, we will align our marketing strategies with POSCO to respond to increasingly protectionist trade policies. We will strengthen our global steel marketing leadership by reinforcing the role of the group's production sites as sales and procurement hubs. Finally, we will accelerate the restructuring of non-core assets in order to respond to potential crises and improve financial soundness, and we will deliver the shareholder returns promised to the market through continuous improvement in profitability.
We appreciate your continued support as we navigate challenges and drive growth this year. Next, Mr. Jeong Yeon-in, we'll present the 2024 business performance, progress of key initiatives, and 2025 outlook. Following that, we will have a Q&A session.
Thank you. Thank you for your remarks. Now, let's begin with the Q4 2024 earnings presentation. Please turn to page four. In 2024, due to global economic downturn and a decline in the steel market, the operating profit of the materials business decreased by approximately KRW 91 billion compared to the previous year. However, strong performance from Myanmar gas field and the effects of terminal expansion limited the overall decline in the company's total operating profit to KRW 46 billion YoY, a slight decrease of about 4%. The company's overall OPM remained unchanged from the previous year at 3.5%. Debt increased slightly by approximately KRW 100 billion compared to the previous year.
However, the net debt ratio declined by 4.4 percentage points, further strengthening financial stability. Now, let's move on to the detailed performance in the energy business. Please turn to page five. In 2024, the energy business maintained stable earnings driven by the value chain. If you look at the table on the left, in the upstream Myanmar gas field, sales slightly decreased due to lower sales volume. However, operating profit increased by KRW 26 billion YoY, driven by the improved cost recovery ratio and the impact of exchange rate increase. The sales volume and operating profit of Australia's Senex remained at the same level as last year. Once the expansion is completed around the end of this year, the impact of its G&A expenses will disappear, and Senex's profits are expected to contribute significantly to the overall profit growth of the company.
On the right side, we have midstream and downstream performance. The midstream terminal business saw a KRW 7 billion YoY profit growth due to the expansion of terminals and the increased profitability of the vessel commissioning business. Although the power generation business experienced a decrease in profit due to the decline in SMP, the profit growth in upstream and midstream businesses offset the decline in SMP, resulting in overall 2% growth in energy business profits compared to the previous year. Please turn to page six. This is the materials business. In 2024, the global economic downturn and worsened conditions for commodities had an impact on both our materials business sales and profits. However, as you can see on the left table, steel trading business sales declined 8.9% YoY, but the sales decline of eco-friendly materials was limited to 2.8%.
So we were able to partially defend the decline in sales and profit of the overall materials business. The table on the right refers to the EV motor core business performance. As you can see on the right table, the HEV overseas sales volume expansion offset the decline of domestic sales volume, and the annual sales volume maintained the same 1.88 million unit level, which was the same level as the previous year. Operating profit was sluggish due to the Pohang New Plant operation. Next, I will cover key developments for major businesses. Please refer to page eight. On page eight, I will cover our 2024 key energy business developments. Please refer to the left side of the page. In upstream, we expanded asset reserves. We completed phase three development of the Myanmar gas field and commenced commercial production from May.
On the other hand, additional reserves were discovered in new and existing gas fields, and phase four development is also smoothly progressing. We made additional investments to increase production by 3x compared to the existing level for Australia Senex, and plans are smoothly being implemented, including a gas processing facility trial operation. Also, in the case of Malaysia PM524 gas field, preparation has been made for the full-scale exploration drilling this year as well. Please refer to the right side of the page. We focused on securing growth drivers in the mid and downstream. Gwangyang LNG Terminal One has fully completed six storage tanks and commenced commercial operations from Q3. LNG Terminal 2's new Units 7 and 8, which are newly being constructed, have a construction progress rate of about 40% and is being carried out as scheduled.
Last but not least, Incheon LNG Combined Cycle Units 3 and 4 also received conditional approval in November to replace and change to hydrogen co-firing power generator and also are steadily preparing for our transformation into a future energy business. Next is the materials business. Please go to page nine. Please refer to the left side of the page. In 2024, in the mobility business, based on our group capability, we focused on the qualitative advancement of our mobility business. In addition, we invested and started construction in a timely manner in overseas hub production subsidiaries, including Mexico Plant 2 and Poland new plant. We have been driving EV motor core market share growth through expanding global production infrastructure. Please look at the right side of the page.
In the case of secondary battery materials business, on September 3rd, an approximately KRW 58 billion contract was signed regarding the Tanzania Mahenge mining project with Australian BRM Company, and we established a secondary battery chain. Lastly, in the materials bio business, we established an operation system to prepare for the commercial operation of our Indonesian palm oil refinery subsidiary, and we are preparing for full operation in the second half of this year. Next, let's cover the forecast for 2025. Let's go to page 11. These are the key strategic directions for 2025. The gas business will be expanded not only by growing our existing operations, including our Myanmar gas field, but also through expanding our business through acquiring new assets. The power generation business will focus on preparing for our next LNG business, including implementing hydrogen co-firing transitions.
For steel business, we will focus on expanding our group's domestic and global markets, and in case of our mobility business, we will strengthen OEM customer package marketing to expand global order amounts. In case of agri-bio business, we will expand business based on new palm oil asset acquisition. From the next pages, I will cover in detail the strategic directions that I have just covered. Please refer to page 12. Let's look at the energy business on the left side of the page. In the case of upstream Myanmar gas field and Senex, we will focus on achieving plant sales and operational goals. In case of midstream, we will pull up the Gwangyang LNG Terminal 2, Unit 7 and Unit 8 construction progress rate to the planned 78% by the end of 2025.
In downstream, we will successfully enter into domestic collective energy business and in overseas secure Vietnam Quynh Lap operational rights. Through this, we plan to focus on acquiring new power generation operational rights. Please refer to the materials business on the right side of the page. In the case of mobility business, we have plans to continue expanding our overseas capacity to Mexico, Poland, India, and other countries to have more than 7 million unit production capability by 2029. In the materials bio business refinery subsidiary, we plan to commence full operation in Q3 of this year, and at the same time, we're going through a process to select a new palm plant for acquisition, and we are going through an internal investment process at the same time, and we have plans to complete our acquisition progress process in Q4. Let's go to the next page.
On page 13, you can find the performance forecast we are expecting when our major strategies have been executed as planned. Please refer to the material for more details. Lastly, I would like to cover our corporate value enhancement plans. Please go to page 15. Since you are probably well aware of these points, I will just cover the key points. As you can see on the left side of the page, we set first stable growth of profits and second, efficient use of capital as our value-up approaches and selected as key metrics, as you can see on the right, pre-tax profit and ROIC. Our company for the last few years, based on our energy-focused business portfolio, has been investing in growth businesses and has consistently grown. In particular, there was profit growth through large-scale M&As, including Senex Energy in 2022 and POSCO Energy in 2023.
Going forward, through organic growth, which will increase productivity of our already acquired assets, we will maintain our sustainable growth momentum and at the same time achieve inorganic growth through methods such as M&As in Indonesia and Vietnam. In particular, we plan to invest capital only in areas where we can generate ROIC of WACC 8% or above and achieve annual pre-tax profit exceeding 8% and maintain for the next three years a 50% range level of shareholder return ratio which befits this growth. Our shareholder return ratio goal is at a level which took into consideration the average of between 30%-50% ratio, which is being set forth by Korean and five Japanese companies, as well as the level we conferred through surveys to our company's major institutional investors. We are also planning to implement interim dividends this year as well. Please refer to the next page.
Let's go to page 16. We expect the company to generate between KRW 5 trillion-KRW 5.2 trillion of cash flow for the next three years. We plan to execute about 60%-65% level, which is the biggest portion of the generated cash for growth investment for the future. And we expect to invest about 20% level to strengthen our financial soundness, including repaying our borrowings. As you are well aware, Corporate Value Enhancement Plan is recommended to be disclosed regularly once a year. So accordingly, from our next disclosure, we plan to continuously communicate with the market about our goals, achievements, and areas for improvement. Apart from these regular disclosures, through value days for core businesses and NDRs, we will actively conduct our activities to strengthen communication. With this, I will conclude my presentation. Operator, please start the Q&A session.
Please keep your questions short and limited to one to two questions so that everyone can have a fair chance to ask questions. Operator, please start the Q&A session right away.
We will now begin the Q&A session. If you have a question, please press star and one on your phone. To cancel your question, please press star and two. And the first question is from Mr. Shin Young-jin of Shinyoung Securities. Please go ahead.
My name is Shin Young-jin from Shinyoung Securities. I have two questions. And the first question is this one. This is related to the Trump administration's tariffs. And so would that have any impact on your investment on graphite and steel? And the second question is this. In 2025, what is your natural gas outlook for LNG in 2025, as well as energy impact on your energy business? Thank you.
Thank you for your questions. And Mr. Ahn will answer the first question. I am Head of the Hot Rolled and Semiproduct. President Trump has announced that his administration is going to be imposing tariffs on Canada, Mexico, and China. And about the adjustment about the quota for Korea, it was not announced yet. So the steel quota from Korea, well, will that be adjusted? And how much tariff will be imposed? Well, there are a lot of uncertainties regarding that. Well, Korean products go through Mexico and Canada, and those are some of those products. And for the Korean steel products, we'll have to wait and see. We will have to pay keen attention, and we will come up with the measures in cooperation with POSCO. Thank you. Good afternoon. I am from the ENP at business about the natural gas outlook and its impact on the upstream business.
In 2025, the oil price and natural gas with the policy of the U.S. administration will be focused on America First. And the oil price, we expect to be stable at a lower price. And the gas prices, we expect a slight increase. And if we connect that to the profit of our company, well, for the Myanmar gas, it's about 40% related to the oil price. If oil price declines by $10, and so in terms of OP, there will be about minus KRW 8 billion impact. And in case of Senex, it's only 40% linked to the oil price. And so for Senex, only 30% is connected to the oil price, and Myanmar was 40%. And so that is going to have a KRW -5 billion impact on our operating profit. Thank you. Hwang Eui-Yong from LNG business.
After the Trump administration has been launched, what sort of impact would that have on the LNG business? LNG gas production and the liquefaction related approvals or permissions we expect will be accelerated. But there is a forecast there would be a drop in the LNG price. There would be approvals. There would be permissions. However, what's really important is whether we would be able to get the customers and the long-term customers. With the liquefied gas, we had a demand and supply issue, but the biggest issue we had with the approvals and the permissions. But what's important is whether we'd be able to get the contract. And also for the liquefied gas, in North America, liquefied gas prices are declining. I find it difficult to agree with that. But thank you for the question and answer. The next question is from Daishin Securities.
Please ask your question. I'm Lee Tae-Hwan from Daishin Securities. For 2025, regarding your goals, I have two questions. The first question is about your gas business. So for your Myanmar gas field, for your sales for 2024 compared to 2023, you can see that there was a market decline. For 2025, your goals, it doesn't seem to be very different. So for your sales going forward, do you think it will remain at this annual level going forward and be maintained? So that is my first question. And second is your EV motor core business. So we do know that in 2024, the shipments actually went up greatly, but on a YoY basis compared to 2023, the sales was similar. So I'm curious about how it can be improved in 2025. So regarding the business conditions, can you give us your take? Thank you very much.
Thank you for your question. Regarding the sales for Myanmar gas field for last year, it was about 160 or so, $16 billion or so. But it was lower than expected because the domestic sales in Myanmar, for some generators, it was shut down. So the sales went down slightly. So that is why our results were less than planned. But if that does not happen this year, then we have a goal of 17.2. And going forward, it is based on the domestic sales. And for domestic sales, it actually goes up during the wintertime. So I think we will have some room for improvement. Thank you very much for your answer. I am the head of the mobility business. And regarding the 2025 EV motor core business, I would like to give you my take on the forecast for the production in 2024.
As was mentioned in the presentation, it was 1.88 million. And it was a little bit lower than expected. It was because we had a downturn in the sale of EV cars. And for this year, for overseas and domestic, we have about 2.5 million units that we have received orders for that we secured. And we believe that it will be more or less the similar number of units. So for 2024, it will be about 33% increase compared to the 1.88 million of the previous year. And with the 25% tariff by Trump and with the EV chasm during the past year, we have had many difficulties. And for the OEMs as well, they have also been thinking about how to relieve this problem. And they have actually been focusing more on the hybrid units rather than on only EV units.
And you can see one of the order trends we're receiving for 2025 are for hybrid cars, also for EV cars as well, but also hybrid. And for GM and Ford and for Rivian, we see the North America OEMs. So with the 25% tariff that Trump has announced, they are looking at low-cost EVs, so $20,000-$30,000 EV car development projects that they're embarking on. And it will actually be connected to the SOPs going forward. And IHS Markit, S&P Global is forecasting that for the hybrid portion, until 2026 and 2027, it will be maintained at about 40%. And from 2028, there will be a bigger proportion of EVs which will overtake. So 2025, 2026, 2027, 2028 is when Trump's reign will end. So I think maybe it's a coincidence that they're seeing that the global companies are seeing that EVs will pick up at that time.
So it will be reinvigorated. So we will be working hard to secure orders for low-cost EVs. And for this year, hybrid and EV sales will be about 2.5 million units so that we can have a 33% increase compared to the previous year. Thank you very much. We'll take the next question. Next question will come from Mr. Yoo Jae-Han, Meritz Securities. Please go ahead. Good afternoon. My name is Yoo Jae-Han. Related to your capital plan, well, in terms of steel and in power generation, well, you didn't actually meet the goals. And also, there was a seasonal factor related to the Myanmar gas field. So if you could tell us more details about those businesses. And this is a one-off of profit or loss or gain. Were there any of them related to any of your business sites? Business.
Head of the business management about the one-off cost or, well, we did not have that much of provisioning. In terms of operating profit, well, if there were economic issues, there were some assets that we decided to exit. There were some assets we decided to sell off, and that impacted our operating profit. An example would be the thermal power plant in Vietnam. We will be selling this plant at about KRW 110 billion . That will be our operating loss. We also have a contract with us to sell our motor core plant in China that will be sold at about KRW 40 billion . We will also be selling off a plant in Uzbekistan worth about KRW 10 billion . That is going to be incorporated as our operating loss. We will not have any special operating-related loss.
But in non-operating loss, we will have about a total of KRW 200 billion worth of loss in 2025. Thank you. And Mr. Du, as for your first question about power generation, could you be more specific about your question? About this, I have a question related to Myanmar, the EV, of course, motors, and power generation and steel. So I'm going to talk about power generation first. We're going to be giving you the answer related to power generation. My name is Kwon Chul. Let me try to provide you with the answer. In the wintertime, there's less demand for power. And also, there was also increase in supply of power. And that is why the reserve increased. And so the utilization of units 5 and 9 decreased. And that led to a decline in SMP. So that had an impact for power generation business.
So, power generation in Q4, you have an operating loss. You have a deficit. You're saying that there are no special reasons for such a loss besides the ones that you have mentioned. Well, supply increased and demand decreased, leading to SMP decline. So that is the main reason for the operating loss. And so the operating loss, it could not occur for such simple reasons. Even if the weather was not so cold, and the power generation business is a very stable business. So I'm sorry to say this. Do you believe that such a situation will continue? Could you give us an outlook for the power generation business? Or there was something that I did not mention. And one is related to the maintenance. So we do regular maintenance.
In Q4, we did a large scale of maintenance, which led to a reduction in sales. In case of large maintenance, we have a yearly plan. This is something we do on a regular basis. This is not going to have any sudden impact on our profitability. About Myanmar business, well, that was already mentioned. We will move on to the EV motor cores. My name is Kim Young-Il from the mobility business. Related to our business performance in Q4 for the core motor business, well, as Mr. Park has said, one thing that stands out is about the sell-off of our plant in China. We have exited that asset in China. We have decided to strategically exit our Chinese business. That has had some loss.
In China, so there were some products that we manufactured in China and exported to Mexico. But we and our customers, well, they were trying to localize their businesses in North America. So they had those needs. So we had to meet those needs. And that is why we decided to strategically exit our Chinese business and move to Mexican locations. So that had a significant impact on the core motor business. And then we also had overall impact from this sluggish EV market. Thank you. So thank you for the question and answer. And about steel, maybe Mr. Ahn could talk about the Q4 performance as well as the outlook for 2025. Well, related to steel in last year, or it was sluggish all throughout the year. And Q4, we did not do as well as Q3. In Q4, well, the customers were adjusting their inventory.
And so that was one of the reasons. And in the beginning of the new administration and the quarter adjustment by the EU, those are the uncertainties. And so that is why our customers delayed the securing or sourcing the raw materials for their activities. And that is why overall global steel market size in a way declined. So that was an impact that we could see in Q4 with the new Trump administration. And with the trade policies of different countries in question, well, we will see some uncertainties. And because of those uncertainties in Q1, however, in Q1, we expect to see an improvement over Q4 of next year. Thank you very much for your answers. We will receive the next question. The next question will be from Samsung Securities. Paek Jae-Seung. You're on the line. Thank you very much for this opportunity.
I am from Samsung Securities, Paek. And I have about three questions. My first question is regarding the 2025 CapEx for the energy business that is on your presentation material, and energy and materials for 2025, respectively. Can you tell us about the CapEx that you're expecting? And can you give us a breakdown on how much you're going to spend for different businesses? Next question is about the U.S. LNG liquefaction facilities and development facilities. There is a lot more investment. And in the U.S., you can see the LNG volume. Is that going to translate into trading? And what is the proportion? Because I think going forward, then it can maybe have an influence on how you're going to participate in this business in the U.S. if you are going to.
And last question for the POSCO mobility solution possibility of sale of this part of your business. Do you think there is a possibility of that? Thank you very much. Thank you very much. And I am the Head of Business Planning. And for this year's investment plan, you can see the total investment amount. It was KRW 1.1 trillion last year. And for this year, it's about KRW 1.3 trillion that we're planning. And for the different businesses, KRW 120 billion for steel. And for EV motor core, we have Mexico and Poland. Some of that is included there. And for materials bio, you can see that we have our palm plant that we are planning to acquire. So it's about KRW 200 billion . And you can see a lot for the terminals for energy. So it will be about KRW 350 billion .
Then for ENP, for gas ENP, it's about KRW 500 billion. So that will be about KRW 1.3 trillion of investment that we're planning for this year. For the question related to U.S. LNG, I will ask Mr. Hwang to answer the question. I am Hwang Eui-Yong of the LNG business. For North America liquefaction facility and production, we are expecting it to expand as well. For our group, Gulf Coast, Cheniere is an area. We have about 400,000 ton long-term acquisition contract that we have signed. In 2026, late the second half of this year, we will have this coming in. Another point is we have another long-term contract. This will be produced in North America. Shipment is going to come from the Pacific. It's greenfield project. You can see that we have had a long-term acquisition contract.
We are going to actually look at different trends to see other opportunities. For the two cases that I have before mentioned, these contracts were signed before inflation. That is why compared to the recent contracts, we believe that these are quite competitive. Going forward, related to the forecast and outlook for our group, we have about $1.1 billion North America LNG gas contract that we have signed. I think we will need to discuss other long-term contract opportunities. For our stability in getting the materials, and because we do need to be prepared, we are actually internally deliberating on the acquisition of stakes for liquefaction for equity investment. I will ask Mr. Park. I think there was an article related to this. The sell-off or sale of the mobility business is unfounded at all.
And we are making many investments in that. And in mobility, there is the stainless business. And we had some restructuring there. The operational rate went down. And some employees actually retired. So maybe that was the reason for those rumors. There were some restructuring. But we don't have any possibility of selling off the mobility business at all. Thank you very much. We'll take a question from Moon Kyung-Won of Meritz Securities. Good afternoon. My name is Moon Kyung-Won from Meritz Securities. I have a question related to power generation about modernization projects. Could you tell us the schedule and expected benefits of such modernization projects? And also, this was mentioned in your presentation about additional investment for power generation. And you have those investments in Korea as well as abroad.
Also, can you give us where do you expect to make the investment and what your investment schedule is like? Mr. Kim Dae-Yeon will provide you with the answer. I'm responsible for the power generation. About the Incheon power plant Unit 3 and 4, we're going to participate in the auctioning of the hydrogen market, and so if we win that bidding, then we're going to begin the construction in Q3 of 2026. We're going to complete the construction in 2029 and begin commercialization. Incheon Unit 3 and 4, and if we could, we have some profits of about KRW 70 billion, but it's aging. Therefore, the profitability is decreasing. So if we have a modernization, our profit will increase to about KRW 120 billion. That's an increase in profit. About power generation in Korea, the collective energy, whether it's expected to be approved.
We have asked for there is a proposal that has gone with the electricity commission related to that. Also related, we are also looking into possible M&As for the energy in the Seoul metropolitan area. Also we are looking into a business in Vietnam. Maybe there will be a bidding in the second half of this year. We are making the preparation to take part in that bidding process. Thank you. Thank you. We'll take the next question. The next question is from Hana Securities. Yoo Jae-Sun, you're on the line. I am Yoo Jae-Sun from Hana Securities. Regarding your corporate value enhancement plan, I have some questions. For capital allocation, you mentioned KRW 0.9 trillion to about KRW 1 trillion of that repayment. Will that be possible? For shareholder return, you mentioned that about 50% is the ratio that you're thinking of.
Will that be done purely by dividends or with other methods as well? Thank you very much. I am Cho In-Cheol from the IR department. Regarding the dividends, to elaborate on that, for dividend payout ratio, we put it as shareholder return ratio. For the shareholder return ratio, there's the dividend income plus the treasury share sell-off or the cancellation. We had a relatively lower dividend payout or profitability ratio. That is why we are trying to set that. If the share prices declined, we also will have treasury sale cancellation as well. We have a BOD meeting for the end of the quarter. We are going to actually disclose the dividend amount after that BOD takes place. Thank you very much. I am the head of business planning. You asked about that repayment schedule.
And from this year, there will be, for the next three years, about KRW 3.3 trillion that we will repay. And KRW 1.2 trillion for this year and for next year, for 2026, KRW 800 billion and the same amount for the next year. So it will be about KRW 3.3 trillion of that repayment schedule that we have. Thank you. Thank you very much for the question and the answer. We'll take the next question. Or there are no questions currently waiting. So if you want to ask your question, please press star and one on your phone, please. We're going to wait for about 30 seconds. And the next question is from Park Gwang-Yeon from Shinhan Securities. Good afternoon. My name is Park Gwang-Yeon from Shinhan Securities. You talked about Q4 performance as well as the outlook for 2025.
In 2030, your market cap is expected to be about KRW 26 trillion , which means that you would have to grow your market cap by about fourfold. So you would have to grow your market cap by KRW 20 trillion per annum, which means. But it seems that you are expecting for the 8% growth. So the remaining 12% of growth, how are you going to achieve that growth? Are you going to be utilizing inorganic growth methods such as M&A? My name is. [audio distortion] from the IR team. And I understand your question. Well, our pre-tax profit growth is about 8%. But if you look at our past five years with the Senex, with the POSCO Energy, we have had substantial inorganic growth. And with those, we have been able to have a pre-tax growth of about 20%.
As we have proposed in our value enhancement plan, we have proposed about 8% growth. That is a very conservative number. As you have just mentioned, we could go through M&A activities to drive growth. That is going to help us to achieve our ultimate goal. By 2030, we may have the market cap of about KRW 21 trillion or KRW 23 trillion. It seems that there are no other questions in the queue. We will conclude today's earnings conference call. If you have any further questions, please do not hesitate to ask us. We will have other NDRs to answer your questions. Please feel free to contact our IR team. Thank you very much, all the analysts and everyone from the management who are here with us in attendance. Thank you once again.