[Click eStock] "Hanwha Systems, Growth in Existing Businesses and Expectations for New Ventures like 'Hydrogen Air Taxi'"

[Asia Economy Reporter Oh Ju-yeon] NH Investment & Securities expects Hanwha Systems to benefit from reports of winning the Korean next-generation destroyer (KDDX) combat system contract and the selection of its affiliate (Hanwha Defense) as the preferred bidder for the export of K-9 self-propelled howitzers to Australia. Additionally, it forecasts that new business sectors such as 'hydrogen air taxis' could start showing tangible results around 2023. Accordingly, the investment rating was maintained at 'Buy' and the target price was raised from 11,300 KRW to 17,200 KRW.

On the 9th, NH Investment & Securities applied a 50% valuation premium over the industry average price-to-earnings ratio (PER) to the target price, reflecting differentiated factors compared to competitors.

Researcher Choi Jin-myung cited five reasons: ▲ Visibility of securing the KDDX combat system contract and securing domestic growth drivers, ▲ Visibility of K-9 self-propelled howitzer exports to Australia and securing growth drivers in parts exports, ▲ No damage occurred before and after the COVID-19 pandemic due to the business structure, ▲ Imminent realization of performance from venture subsidiaries, ▲ Benefits from the 'Green New Deal' policy following selection as the leading company in the Korean hydrogen air taxi business.

Researcher Choi explained, "The growth of core businesses is stable. The ICT sector has been conducting an improvement project for the affiliate's insurance core solution since the second quarter, and captive volume is expected to be secured in the future. The defense sector is in full production of the TICN third batch mass production volume ordered at the end of 2019. Considering recent reports of winning the Korean next-generation destroyer (KDDX) combat system contract and the promising news of K-9 self-propelled howitzer exports to Australia, continued growth is expected."

He positively evaluated Hanwha Systems' venture investments and entry into new businesses. While it is realistically difficult to precisely estimate new business performance and potential profit size at this point, it is analyzed that significant profit generation is expected around 2023.

Researcher Choi stated, "The subsidiary Phasor Solution will begin antenna sales from 2021, coinciding with the service launch of Space-X, the planned low-earth orbit satellite communication network operator. Another subsidiary, Overair, is expected to generate related sales around 2023, the launch time of its partner Uber's air taxi service." He added, "Domestically, the 'Green New Deal' policy includes 'hydrogen air taxis,' so benefits are anticipated."

He noted, "It is difficult to accurately estimate the growth speed of the 'air taxi' or 'low-earth orbit satellite communication network' businesses, but optimism prevails among overseas investors. For example, Elon Musk's Space-X recently secured investment funds necessary for the Starlink project, recognized with a corporate valuation of 58 trillion KRW, and is continuously launching low-earth orbit satellites every month. Many global major companies have participated in Uber's Uber Air project," he added.

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