[Click eStock] "Hanwha Solutions, 3Q Earnings Below Expectations... Target Price Down"

NH Investment & Securities lowered the target price for Hanwha Solutions from 51,000 KRW to 45,000 KRW on the 12th. However, the investment rating was maintained at 'Buy.'

Hanwha Solutions is expected to record sales of 3.6 trillion KRW and an operating profit of 104.7 billion KRW in the third quarter. This falls short of market expectations. While sales from the existing power generation business were initially expected to reach 1 trillion KRW, delays in some project negotiations and sales are likely to limit this to 700 billion KRW. Operating profit is expected to decrease by 56% compared to the previous quarter due to negative lagging effects causing a decline in module profitability and costs related to distributed power generation.

Choi Young-kwang, a researcher at NH Investment & Securities, said, "Hanwha Solutions' stock price continues to decline, reflecting concerns about slowing earnings." He added, "Although a decline in profitability is expected until the third quarter due to the time lag in wafer cost recognition, module profitability is expected to rebound from the fourth quarter when the lowered wafer prices are reflected." He continued, "Considering that the 2GW expansion, originally scheduled for completion in the first half of 2024, has been advanced and is now operational, the scale of the Advanced Manufacturing Production Tax Credit (AMPC) is also expected to increase," emphasizing, "It is necessary to focus on the mid- to long-term direction of earnings improvement."

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