Corporate Logo(source: hanwhaaerospace.com)
On April 21, Korea Investment & Securities raised its target price for Hanwha Aerospace (012450) to 1.3 million KRW, citing enhanced export competitiveness and robust performance in the ground defense sector. The new target represents a 59.31% upside from the previous day's closing price of 816,000 KRW. The firm also named Hanwha Aerospace its top pick in the defense sector, emphasizing the company’s strong export pipeline spanning the Middle East, Asia, and Europe.
Jang Nam-hyun, an analyst at Korea Investment & Securities, stated, “Hanwha Aerospace has secured multiple export channels for systems such as the K9 self-propelled howitzer, the Chunmoo multiple rocket launcher, and the Redback infantry fighting vehicle. Considering both profitability and order backlog expansion potential, Hanwha Aerospace should not be trading at a discount compared to its European peers.” The target price is based on a price-to-earnings ratio (PER) of 27.7x.
The company's export competitiveness is expected to be further reinforced by the establishment of global production bases, funded through a planned capital increase. Hanwha Aerospace intends to raise 3.6 trillion KRW via a rights offering, and, combined with future operating cash flow and debt, plans to invest a total of 6.3 trillion KRW in joint ventures and production facilities. These include missile manufacturing operations in Eastern Europe, a joint venture with Saudi Arabia’s Ministry of National Guard, and facilities for missiles, ammunition, and ground support equipment in Europe.
“Demand for weapons systems is rising in Europe, Saudi Arabia, and other regions, while internal procurement needs are also expanding. This makes the acquisition of local production bases increasingly important,” Jang added. “By proactively establishing overseas facilities, Hanwha Aerospace is poised to strengthen its long-term export competitiveness.”
For the first quarter of 2025, the brokerage projects Hanwha Aerospace will report revenue of 5.5141 trillion KRW and operating profit of 568.5 billion KRW, surpassing market consensus by 15.2% and 13.2%, respectively. “We expect Q1 earnings to reflect the delivery of 20 K9 units and 18 Chunmoo launchers to Poland. Our forecast also includes operating profit contributions from Hanwha Ocean,” the analyst noted.
*[KOSPI]Hanwha Aerospace(012450) engages in the production and sales of aircraft, gas turbine engines, artillery systems, and armored vehicles domestically and internationally. Market capitalization is 37.69 trillion won(as of April 18, 2025, closing price).
Corporate Logo(source: hanwhaaerospace.com)
On April 21, Korea Investment & Securities raised its target price for Hanwha Aerospace (012450) to 1.3 million KRW, citing enhanced export competitiveness and robust performance in the ground defense sector. The new target represents a 59.31% upside from the previous day's closing price of 816,000 KRW. The firm also named Hanwha Aerospace its top pick in the defense sector, emphasizing the company’s strong export pipeline spanning the Middle East, Asia, and Europe.
Jang Nam-hyun, an analyst at Korea Investment & Securities, stated, “Hanwha Aerospace has secured multiple export channels for systems such as the K9 self-propelled howitzer, the Chunmoo multiple rocket launcher, and the Redback infantry fighting vehicle. Considering both profitability and order backlog expansion potential, Hanwha Aerospace should not be trading at a discount compared to its European peers.” The target price is based on a price-to-earnings ratio (PER) of 27.7x.
The company's export competitiveness is expected to be further reinforced by the establishment of global production bases, funded through a planned capital increase. Hanwha Aerospace intends to raise 3.6 trillion KRW via a rights offering, and, combined with future operating cash flow and debt, plans to invest a total of 6.3 trillion KRW in joint ventures and production facilities. These include missile manufacturing operations in Eastern Europe, a joint venture with Saudi Arabia’s Ministry of National Guard, and facilities for missiles, ammunition, and ground support equipment in Europe.
“Demand for weapons systems is rising in Europe, Saudi Arabia, and other regions, while internal procurement needs are also expanding. This makes the acquisition of local production bases increasingly important,” Jang added. “By proactively establishing overseas facilities, Hanwha Aerospace is poised to strengthen its long-term export competitiveness.”
For the first quarter of 2025, the brokerage projects Hanwha Aerospace will report revenue of 5.5141 trillion KRW and operating profit of 568.5 billion KRW, surpassing market consensus by 15.2% and 13.2%, respectively. “We expect Q1 earnings to reflect the delivery of 20 K9 units and 18 Chunmoo launchers to Poland. Our forecast also includes operating profit contributions from Hanwha Ocean,” the analyst noted.
*[KOSPI]Hanwha Aerospace(012450) engages in the production and sales of aircraft, gas turbine engines, artillery systems, and armored vehicles domestically and internationally. Market capitalization is 37.69 trillion won(as of April 18, 2025, closing price).