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

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

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

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

<ul>
<li>Next day’s base price uses the 3:30pm close—NXT's after-hours moves don’t count. That small gap can impact rights offerings, as seen in Samsung SDI’s pricing delta on April 8.</li>
<li>NXT after-hours volumes count toward VWAP. So in uptrends, they can impact pricing—possibly with Samsung SDI’s final reference price on May 16.</li>
<li>No shorting allowed after 3:30pm on NXT, leading to inefficiencies—while not yet fit for latency arb, it’s ripe for tactical day–night spread plays and re-entry timing.</li>
</ul>


Next day’s base price uses the 3:30pm close—NXT's after-hours moves don’t count. That small gap can impact rights offerings, as seen in Samsung SDI’s pricing delta on April 8.
NXT after-hours volumes count toward VWAP. So in uptrends, they can impact pricing—possibly with Samsung SDI’s final reference price on May 16.
No shorting allowed after 3:30pm on NXT, leading to inefficiencies—while not yet fit for latency arb, it’s ripe for tactical day–night spread plays and re-entry timing.


How NXT (ATS) Affects Event Pricing from a Microstructure Perspective

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

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

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

How NXT (ATS) Affects Event Pricing from a Microstructure Perspective

This post breaks down how NXT (ATS) impacts event pricing from a microstructure standpoint, highlighting how its extended hours session influence...

Sanghyun Park

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

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

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

How NXT (ATS) Affects Event Pricing from a Microstructure Perspective

This post breaks down how NXT (ATS) impacts event pricing from a microstructure standpoint, highlighting how its extended hours session influence...

Sanghyun Park

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