Shares of Hanwha Aerospace are on the rise, attributed to uncertainties surrounding the U.S.-Iran conflict and news of the Canadian Ministry of Defense's plans to replace aging armored vehicles.
As of 2:12 PM on May 19, Hanwha Aerospace's stock was trading at 1,292,000 won, up 65,000 won (5.30%) from the previous trading day, according to the Korea Exchange.
The surge in Hanwha Aerospace's stock appears to be influenced by recent reports that the Canadian Ministry of Defense is moving forward with a modernization program for its outdated tanks and armored vehicles. Local media in Canada reported that the ministry has issued a request for information (RFI) to major defense contractors.
The Canadian next-generation tank program aims to enhance the performance of existing tanks and select a new main battle tank (MBT) model by 2030. The program targets achieving initial operational capability (IOC) by 2035 and full operational capability by 2037, with an estimated budget of $620 million (approximately 920 billion won).
Jae-ho Seo, a researcher at DB Securities, noted, "Despite expectations for continued solid earnings growth, Hanwha Aerospace is entering a correction phase due to declining multiples among its European peers. However, with ongoing growth in orders from Rheinmetall through the first quarter, the K-defense premium is expected to stand out when production capacity is leveraged to fulfill these orders."
Yong-jin Byun, a researcher at iM Securities, mentioned, "Following a collaboration agreement signed in February, we have established a partnership this month with Malem Robotics and Hanwha Aerospace Romania for joint participation in the unmanned ground vehicle (UGV) business at the BSDA in Romania. We anticipate actively responding to the increasing demand for unmanned systems from European and NATO countries in the post-war context."
* This article has been translated by AI.
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