Hancom Soars Alone on Strong Cloud Business Performance

Kosdaq Falls 9% This Month... Hancom Rises 22%
Q3 Operating Profit Increases 160%... Growth Expected to Continue
Anticipated Growth as a Global Standard AI Company

The KOSDAQ index has fallen nearly 9% this month, dropping to the 670 level, while the stock price of Hangul and Computer (Hancom) has surged vertically, attracting attention. This is interpreted as a continued rise in stock price due to a sharp increase in third-quarter profits. Market experts predict that sales related to artificial intelligence (AI) will increase, leading to sustained growth in the future.

According to the financial investment industry on the 25th, Hancom's stock price rose 21.7% this month. The return compared to the market reached 30.5 percentage points. Domestic institutional investors led the rise in Hancom's stock price by accumulating net purchases worth 26.9 billion KRW during this period.

Hancom recorded consolidated sales of 71.2 billion KRW and operating profit of 8.5 billion KRW in the third quarter of this year. This represents increases of 24.9% and 159.9%, respectively, compared to the same period last year. On a separate basis, sales were 37.6 billion KRW and operating profit was 12.2 billion KRW, up 32.8% and 107.6% from the same period last year.

Kim Hak-jun, a researcher at Kiwoom Securities, said, "Cloud sales grew nearly threefold compared to the same period last year," adding, "From next year, it will be clearly seen that the company is transforming into a cloud and AI-related firm."

Park Jong-sun, a researcher at Eugene Investment & Securities, explained, "The positive aspect of the third-quarter performance is that sales increased significantly compared to the same period last year and profitability improved," adding, "The proportion of cloud sales in total sales rose from 14.8% in the third quarter of last year to 31.5% in the third quarter of this year."

Hancom is preparing AI-related businesses for future growth. In October last year, it conducted a closed beta test (CBT) of 'Hancom Docs AI,' which combines generative AI with the web office service Hancom Docs, and officially launched it this year. It provides AI templates for highly demanded documents such as resumes and proposals, and offers an AI solution that automatically generates documents by inputting topics and key content.

'Document QA (Hancompedia)' is a document-based question-and-answer system that digitizes various documents owned by users and provides customized answers based on them. 'Hancom Assistant' is an intelligent document creation tool using AI, which combines with various large language models (LLMs) to allow natural language commands and analyze user intent to automatically assist in document creation.

Lee Byung-hwa, a researcher at Shinhan Investment Corp., estimated, "Hancom is expected to achieve separate sales of 42.7 billion KRW and operating profit of 13.9 billion KRW in the fourth quarter of this year," forecasting increases of 18.7% and 16.1%, respectively, compared to the same period last year. He added, "The application of cloud SaaS will expand to public and private sectors, and the core business performance will continue to grow with the expansion of generative AI product offerings."

Lee Seung-hoon, a researcher at IBK Investment & Securities, said, "Hancom is expected to collaborate with French AI company Mistral AI, which leads AI innovation in Europe," adding, "Mistral AI technology will be integrated into Hancom Assistant to enter overseas markets."

In a recent shareholder letter, Hancom stated, "This year, we are actively pursuing diversification of our business portfolio through the expansion of mid- to long-term growth foundations with cloud SaaS and the establishment of Hancom's own AI value chain," adding, "Hancom aims to be recognized as a global standard AI company by presenting an AI portfolio that can interoperate with major global software without restrictions on specific products."