[Weekly HOT Stocks] Hanwha Solutions Draws Attention Amid Hydrogen Business Expectations

Hanwha Solutions' stock price more than doubles in a week... hits upper limit for two consecutive days

[Asia Economy Reporter Kum Boryeong] Hanwha Group attracted significant attention this week as it was revealed that the company made a preemptive investment in Nikola, a U.S. hydrogen vehicle company dubbed the "second Tesla."

According to the Korea Exchange on the 13th, Hanwha Solutions' stock price rose 9.47% over the week, closing at 16,900 KRW on the 5th and 18,500 KRW on the 12th. Hanwha Solutions' preferred shares saw an even larger increase, more than doubling from 11,100 KRW to 24,500 KRW during the same period. The preferred shares hit the daily upper limit for two consecutive days on the 9th and 10th.

The role of Nikola was significant in drawing attention to Hanwha Solutions. Nikola is a U.S. hydrogen truck manufacturer. Its stock price on the Nasdaq market closed at $33.8 on the 4th (local time) and surged to $73.3 on the 8th, more than doubling, which greatly increased the value of Hanwha Group's affiliate shares. Hanwha Energy and Hanwha Total Petrochemical, affiliates of Hanwha Group, invested $100 million in 2018 to secure a 6.13% stake in Nikola. Notably, Kim Dong-kwan, Vice President of Hanwha Solutions, is reported to have played a significant role in the final investment decision process.

Hanwha Energy and Hanwha Total Petrochemical, which invested in Nikola, are unlisted companies and cannot invest directly. In this context, Hanwha Solutions' 36% stake in Hanwha Total Petrochemical and expectations for Hanwha's entry into the U.S. hydrogen ecosystem market are believed to have been reflected in Hanwha Solutions' stock price.

Anna Lee, a researcher at eBest Investment & Securities, explained, "Hanwha Solutions' Advanced Materials Division can supply tanks for hydrogen charging stations and hydrogen tanks for trucks." She added, "In December last year, Hanwha Solutions' Advanced Materials Division acquired Taekwang Fujikin, a high-pressure tank manufacturing company. Taekwang Fujikin became a 100% subsidiary after Taekwang SCT acquired the company from Fujikin, a Japanese semiconductor equipment manufacturer, in 2009. Their pressure tank technology involves secondary processing of carbon fiber using winding methods."

She continued, "Hanwha Solutions' Chemical Division is developing its own technology to produce hydrogen by electrolyzing water. Therefore, if Hanwha enters the hydrogen business leveraging the Nikola investment, it appears to possess products that could create synergy," she added.

The main business, solar energy, is also positive. Support for Joe Biden, former Vice President and U.S. presidential candidate, is rising. If the Democratic Party wins the U.S. presidential election, a green energy momentum could emerge. Seungjae Han, a researcher at DB Financial Investment, said, "Biden's policies are favorable to renewable energy, as expected from a Democratic candidate. Reviewing Biden's key policies, the overarching premise is the need to prepare to achieve net-zero greenhouse gas emissions by 2050 after his election." He added, "With Biden's rising approval ratings, renewable energy policy momentum could arise after the U.S. presidential election."

This content was produced with the assistance of AI translation services.