[Click eStock] Hanwha Systems: Earnings Below Expectations, New Business Above Expectations

[Asia Economy Reporter Junho Hwang] IBK Investment & Securities maintained Hanwha Systems' target stock price at 23,000 KRW, placing expectations on growth driven by the full-scale investment in new businesses this year.

First, Hanwha Systems is expected to finalize contracts for low Earth orbit satellite business following the completion of its equity investment in OneWeb this month (USD 300 million, 8.8% stake). By next year, the low Earth orbit satellite electronic antenna business is also anticipated to be applied through Hanwha Pager (mobility) and Kaimeta (aircraft). Urban air mobility company Overair is expected to complete the development of the Butterfly aircraft next year and commercialize it around 2025.

At the end of last year, Hanwha Systems also succeeded in securing a large-scale order worth approximately 1.3 trillion KRW for the Korean air defense missile M-SAM (Cheongung 2) destined for the UAE. Additionally, there is potential for further orders from Saudi Arabia and other countries.

Researcher Sanghyun Lee of IBK Investment & Securities evaluated, "While the full-scale investment in new businesses will cause short-term losses and offset the growth in existing business performance, the increased mid- to long-term growth potential and accelerated commercialization are positive factors."

However, Hanwha Systems' operating results for the fourth quarter of last year recorded sales of 679.5 billion KRW and an operating profit of 7.3 billion KRW, falling short of market expectations.

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