'Green New Deal' Hanwha, Retail Investors Targeting Bottom Buy-In

Hanwha Solutions, Individual Investors Net Buy of 300.3 Billion KRW Over 12 Trading Days
Increasing Accumulation During Decline After Peak... Same Pattern for Hanwha and Hanwha Systems
Adjustment Market Amid Nikola Technology Controversy... Investment Decisions from a Mid- to Long-Term Perspective

[Asia Economy Reporter Oh Ju-yeon] Hanwha Group, which has rapidly emerged as a beneficiary of the government's Green New Deal policy, has recently experienced stock price adjustments due to controversies such as the Nikola technology fraud scandal. Despite this situation, individual investors are actively engaging in 'buying at the bottom,' drawing attention.

According to the Korea Exchange on the 18th, individuals purchased Hanwha Solutions worth 300.3 billion KRW from the 1st to the 17th of this month, ranking fourth in net buying. This was the result of buying on 12 out of 13 trading days, excluding just one day.

Hanwha Solutions, regarded as a representative stock of the Green New Deal, saw its stock price nearly double within a month, rising from 25,850 KRW at the closing price on the 3rd of last month to an intraday high of 52,300 KRW on the 7th of this month. This was because it attracted attention as a comprehensive energy solutions company rather than a chemical company, amid growing expectations for future growth in the solar power business. In particular, the global eco-friendly policy trend and the structural growth of the solar power market acted as upward momentum. The government's announcement of the New Deal Fund also served as a factor driving the stock price increase. However, after the sharp rise, the stock price began to fall and, as of 10 a.m. on this day, stood at 42,350 KRW, down 19.02% from the previous intraday high.

Notably, since the stock price peaked and began to decline, individual investors have recorded net buying every single day without exception. Following the purchase of 50.1 billion KRW worth on the 8th, when the stock price fell 5.9% compared to the previous day, individuals have steadily increased their holdings even as the stock price continued to slump amid the ongoing Nikola fraud controversy.

This pattern also appeared in Hanwha and Hanwha Systems, whose stock prices rose and fell for the same reasons. Hanwha, which attracted attention as a core group stock of the Green New Deal, saw its stock price rise from 27,400 KRW on the 1st to an intraday high of 34,700 KRW on the 7th. However, as Nikola, in which Hanwha Group invested, was recently embroiled in a technology fraud controversy and plunged sharply, Hanwha's stock price also slid more than 20% in just over two weeks. Nevertheless, individuals continued net buying for nine trading days from the 7th to the 17th, excluding one day, purchasing a total of 57.6 billion KRW worth. This contrasts with the approximately 5.4 billion KRW net selling during the same period last month.

Hanwha Systems also saw net buying of 17.7 billion KRW this month. On the 16th, when the price surged intraday, purchases worth 16.7 billion KRW were concentrated in a single day.

Although Hanwha Group stocks have experienced overall fluctuations recently due to Nikola-related issues, these are expected to be resolved, and the growth potential from the Green New Deal is not a short-term theme. Therefore, it is interpreted that investors are taking a more mid- to long-term perspective.

Researcher Han Byung-hwa of Eugene Investment & Securities commented on the Nikola controversy, saying, "The rumors that existed even before the listing are repeating," and added, "Nikola's strategy is not free from controversy over the presence or absence of core technology. Whether Nikola-branded vehicles will be produced will be confirmed by European production with Iveco next year and U.S. production with GM in 2022."

Researcher Lee Jin-myung of Shinhan Financial Investment emphasized, "Hanwha Solutions and other Hanwha affiliates are laying the groundwork for entering the hydrogen business based on their respective technological capabilities within the hydrogen value chain," and stressed that they remain attractive from this perspective.

Additionally, Hanwha is drawing attention from a fundamentals (corporate performance) perspective, as the performance of its own business division, which had been sluggish from last year through the first half of this year, is expected to enter an improvement phase in the second half of this year due to factory normalization and restructuring. Researcher Yang Ji-hwan of Daishin Securities said, "Financial structure improvement through restructuring of marginal businesses such as steel and food resources and the sale of Golden Bay GC, as well as the listing of Hanwha General Chemical and the promotion of Green New Deal projects, will gradually heighten investor interest."