North Korea could be ready to test fire an intermediate range ballistic missile by the end of the month, respected defence analysis group Jane's said Friday.

According to experts at Jane's Defence Weekly, satellite imagery taken on Wednesday indicated that Pyongyang was preparing to either launch a prototype Taepodong 2 missile, or a Paektusan 2 space launch vehicle.

"There has been a significant increase in launch preparation activity at the Musudan-ni Launch Facility," Joseph Bermudez, an analyst at the magazine, said.

Bermudez said satellite imagery and reports indicated that the activities included activation or installation of telemetry equipment and radars, the arrival of numerous trucks and support vehicles, a rise in activity at the engine test stand, and launch pad and umbilical tower maintenance.

The magazine also said that support facilities for the engine test stand were being expanded.

South Korean Defence Minister Lee Hang-See said earlier Friday that Seoul would target North Korean launch sites if its ships came under missile attack in the Yellow Sea.

Tensions have risen since the communist North cancelled all peace accords with the South, including one recognising the Yellow Sea border as an interim frontier.

The area saw deadly naval clashes in 1999 and 2002.

The North's military announced Thursday it is "fully ready" for war with South Korea.

Pyongyang is angry at South Korean President Lee Myung-Bak, who rolled back his predecessors' policy of largely unconditional aid and engagement with the North.

He has linked major economic aid to the North's progress on denuclearisation.