Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>In 3Q25, Hanwha Aerospace reported sales of 6.5 trillion won (up 146.5% YoY and 1.6% lower than consensus) and operating profit of 856.4 billion won (up 79.5% YoY).</li>
<li>The company's results in 3Q 2025 were its best ever in its history. The strong results were driven by its land defense business and its shipbuilding unit Hanwha Ocean.</li>
<li>Given the company's excellent growth in sales and profits in the past several years as well as its strong order backlog, its valuationsremain attractive. </li>
</ul>


In 3Q25, Hanwha Aerospace reported sales of 6.5 trillion won (up 146.5% YoY and 1.6% lower than consensus) and operating profit of 856.4 billion won (up 79.5% YoY).
The company's results in 3Q 2025 were its best ever in its history. The strong results were driven by its land defense business and its shipbuilding unit Hanwha Ocean.
Given the company's excellent growth in sales and profits in the past several years as well as its strong order backlog, its valuationsremain attractive. 


Hanwha Aerospace: Best Ever Results in 3Q 2025

Global Materials | Industrials | Commodities

Rahul Jain

<ul>
<li>Hanwha Aerospace has scaled into Asia’s top defense prime, with Land Systems (K9, Chunmoo, Redback) driving &gt;30% OP margins and consolidated revenues compounding ~30% annually.</li>
<li>A ₩31.7 tn orderbook (~4x sales) anchored in Poland, Australia, and Romania underpins multi-year growth visibility, with Ocean adding LNG/naval scale and Systems providing electronics integration.</li>
<li>Hanwha trades in line with peers (~19× P/E, ~16× EV/EBITDA); upside hinges on backlog execution, while governance and ESG risks cap multiples.</li>
</ul>


Hanwha Aerospace has scaled into Asia’s top defense prime, with Land Systems (K9, Chunmoo, Redback) driving &gt;30% OP margins and consolidated revenues compounding ~30% annually.
A ₩31.7 tn orderbook (~4x sales) anchored in Poland, Australia, and Romania underpins multi-year growth visibility, with Ocean adding LNG/naval scale and Systems providing electronics integration.
Hanwha trades in line with peers (~19× P/E, ~16× EV/EBITDA); upside hinges on backlog execution, while governance and ESG risks cap multiples.


Hanwha Aerospace – Growth Is Structural, Governance Is the Cap

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

Korea Stock Exchange KOSPI 200 / Event-Driven

<ul>
<li>Since short selling was banned in November 2023, short interest has plunged in Korea as shorts were covered. Markets have not done much over the last 16 months though. </li>
<li>Foreign investor holdings have dropped from 32.05% in July to 28.57%. The top 25 stocks bought by foreign investors outperformed the top 25 stocks sold by 128% in 16 months.</li>
<li>There will be trade opportunities across indices, pref/ords, index migrations and deletions, potential market upgrades and overvalued stocks being sold.</li>
</ul>


Since short selling was banned in November 2023, short interest has plunged in Korea as shorts were covered. Markets have not done much over the last 16 months though. 
Foreign investor holdings have dropped from 32.05% in July to 28.57%. The top 25 stocks bought by foreign investors outperformed the top 25 stocks sold by 128% in 16 months.
There will be trade opportunities across indices, pref/ords, index migrations and deletions, potential market upgrades and overvalued stocks being sold.


Korea: Short Selling Is Back in March; Trade Ideas

Chief Executive Officer, Emmer Capital Partners Limited

Manishi Raychaudhuri

Chief Executive Officer

Emmer Capital Partners Limited

Emmer Capital Partners is an Asia Pacific focused financial advisory firm engaging in strategic financial asset allocation advice, bespoke thematic research and advising early-stage companies and connecting them to investors. Emmer Capital provides macro-economic and multi-asset investment strategy inputs to institutions, family offices, private wealth managers, private equity, and corporate boards directly and through independent research platforms. Emmer Capital also advises a wide range of startup companies on fund raising and business strategy. Emmer Capital's active engagement with the print and electronic media reaches a broad spectrum of investors across the globe.

Cross Asset Strategy

<ul>
<li>Three 2026 themes: (i) Continued AI spending boom, moats and monopolies to thrive, (ii) Recently commenced commodity super-cycle, especially in copper, (iii) Continued defense spending boom amid accelerating geopolitical tensions.</li>
<li>These themes are well-discussed over the past year, but recent concerns about their longevity (especially AI spending) have derated the beneficiary stocks. We think it's time to re-focus on them.</li>
<li>Our top picks: TSMC (the monopoly AI enabler), Zijin Mining (the gold and copper giant, benefitting from two super cycles) and Hanwha Aerospace (the biggest beneficiary of defense spending boom).</li>
</ul>


Three 2026 themes: (i) Continued AI spending boom, moats and monopolies to thrive, (ii) Recently commenced commodity super-cycle, especially in copper, (iii) Continued defense spending boom amid accelerating geopolitical tensions.
These themes are well-discussed over the past year, but recent concerns about their longevity (especially AI spending) have derated the beneficiary stocks. We think it's time to re-focus on them.
Our top picks: TSMC (the monopoly AI enabler), Zijin Mining (the gold and copper giant, benefitting from two super cycles) and Hanwha Aerospace (the biggest beneficiary of defense spending boom).


2026 High Conviction: Three Themes, Three Top Picks

Equity Capital Markets

Hanwha Aerospace / Equity Capital Markets

<ul>
<li>On 21 May, Hanwha Aerospace (012450 KS) announced that the rights offering price increased to 684,000 won (up 26.9% from 539,000 won previously) due to recent increase in price.</li>
<li>Due to the higher rights offering price, the scale of the capital raise has increased from 2.3 trillion won previously to 2.9 trillion won (US$2.1 billion).</li>
<li>Issue price is determined by applying a 15% discount rate to the one-month weighted arithmetic average price, one-week weighted arithmetic average  price, and the closing price on the base date.</li>
</ul>


On 21 May, Hanwha Aerospace (012450 KS) announced that the rights offering price increased to 684,000 won (up 26.9% from 539,000 won previously) due to recent increase in price.
Due to the higher rights offering price, the scale of the capital raise has increased from 2.3 trillion won previously to 2.9 trillion won (US$2.1 billion).
Issue price is determined by applying a 15% discount rate to the one-month weighted arithmetic average price, one-week weighted arithmetic average  price, and the closing price on the base date.


Hanwha Aerospace: Higher Rights Offering Price and Amount

South Korea

Hanwha Aerospace Co., Ltd. operates as an aircraft parts manufacturing company. The Company produces and sells aircraft gas turbine engine products, aircraft compressors, low pressure turbines, and other products. Hanwha Aerospace markets its products worldwide.

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Hanwha Aerospace (012450 KS)

Hanwha Aerospace: Best Ever Results in 3Q 2025

In 3Q25, Hanwha Aerospace reported sales of 6.5 trillion won (up 146.5% YoY), operating profit of 856.4 billion won (up 79.5% YoY). The company's...

Douglas Kim

Hanwha Aerospace – Growth Is Structural, Governance Is the Cap

Hanwha Aerospace emerges as top defense prime in Asia, driven by Land Systems with high margins and strong revenue growth, backed by diverse...

Rahul Jain

Korea: Short Selling Is Back in March; Trade Ideas

Short selling in Korea commences from Monday. There will be a lot of interest in shorting stocks/sectors depending on how they have performed since...

Brian Freitas

2026 High Conviction: Three Themes, Three Top Picks

2026 themes: AI spending boom continues, commodity super-cycle, defense spending surge. Our top picks are the market leaders in these themes:...

Manishi Raychaudhuri

Hanwha Aerospace: Higher Rights Offering Price and Amount

FSS has accepted Hanwha Aerospace's rights offering securities report finally on 28 May. Amount of issue has been raised from 2.3 trillion won to...

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Hanwha Aerospace: Best Ever Results in 3Q 2025

In 3Q25, Hanwha Aerospace reported sales of 6.5 trillion won (up 146.5% YoY), operating profit of 856.4 billion won (up 79.5% YoY). The company's...

Douglas Kim

Hanwha Aerospace – Growth Is Structural, Governance Is the Cap

​Hanwha Aerospace emerges as top defense prime in Asia, driven by Land Systems with high margins and strong revenue growth, backed by diverse...

Rahul Jain

Korea: Short Selling Is Back in March; Trade Ideas

Short selling in Korea commences from Monday. There will be a lot of interest in shorting stocks/sectors depending on how they have performed since...

Brian Freitas

2026 High Conviction: Three Themes, Three Top Picks

​2026 themes: AI spending boom continues, commodity super-cycle, defense spending surge. Our top picks are the market leaders in these themes:...

Manishi Raychaudhuri

Hanwha Aerospace: Higher Rights Offering Price and Amount

FSS has accepted Hanwha Aerospace's rights offering securities report finally on 28 May. Amount of issue has been raised from 2.3 trillion won to...

Douglas Kim

Hanwha Aerospace emerges as top defense prime in Asia, driven by Land Systems with high margins and strong revenue growth, backed by diverse...

2026 themes: AI spending boom continues, commodity super-cycle, defense spending surge. Our top picks are the market leaders in these themes:...