[Click eStock] "Hanwha Solutions, Solar Performance Improvement... Active Buy + Target Price Up"

[Asia Economy Reporter Son Sun-hee] IBK Investment & Securities on the 2nd issued a 'Strong Buy' investment opinion on Hanwha Solutions and significantly raised the target price from the previous 68,000 KRW to 88,000 KRW.

Hanwha Solutions' operating profit steadily grew from 59.4 billion KRW in 2020, 73.8 billion KRW in 2021, to 110.6 billion KRW in 2022, and is estimated to increase further this year (142.1 billion KRW) and next year (170.6 billion KRW).

In particular, Hanwha Solutions' solar energy division operating profit this year is expected to reach 1.0167 trillion KRW, a 164.2% increase compared to the same period last year. Lee Dong-wook, a researcher at IBK Investment & Securities, said, "This is due to the effect of module expansion in the U.S., improvement in the weighted average module selling price, and decreases in raw material and transportation costs," adding, "Additional performance improvements are expected this year through quarterly sales of power generation assets."

He also stated, "If the profits related to the U.S. Inflation Reduction Act (IRA), which will occur from this year, are applied to the cost of goods sold rather than non-operating income, the solar energy division's operating profit could exceed both our estimates and market expectations," and added, "Although module prices in Europe and China are declining due to falling raw material prices, the U.S. modules, Hanwha Solutions' main market, continue to maintain higher prices compared to other regions due to anti-dumping tariffs, which is expected to positively impact the solar energy division's performance improvement."

IBK Investment & Securities announced that after already raising the target price by about 30%, they plan to further increase it to 100,000 KRW next year. The researcher explained, "The chemical division is expanding the proportion of high value-added products such as fine chemicals, and the solar energy division is increasing sales of N-type and large-area products. Additionally, the incentive effects of the U.S. corporation and downstream sales are expected to be fully reflected in performance starting this year."