[Market Focus] Hanwha Engine Surges Over 10% on Robust Client Orders

The stock price of Hanwha Engine is showing strength as the company is expected to see a sharp increase in performance due to robust orders from client companies.

As of 9:16 a.m. on October 1, Hanwha Engine was trading at 49,450 won, up 4,550 won (10.13%) from the previous trading day.

On this day, SangSangIn Securities initiated coverage of Hanwha Engine with a "Buy" investment opinion and a target price of 60,000 won, stating, "We expect strong order inflows from client companies in the second half of the year, as well as improvements in the composition of order years within sales."

The firm projected third-quarter results with sales of 348 billion won and operating profit of 30.6 billion won, representing increases of 18% and 9%, respectively, compared to the same period last year. In particular, it expects continued margin improvement as order volumes from 2023 and 2024 are increasingly reflected in results.

Lee Seoyeon, a researcher at SangSangIn Securities, explained, "In the third quarter of this year, order volumes from 2023 and last year are each expected to account for half of the total." She added, "Considering the increase in ship order prices during this period, the average selling price (ASP) of ship engines is also expected to benefit from this upward trend."

She further noted, "Through facility investment, we anticipate an annual production capacity increase of about 20% in terms of horsepower," and added, "New orders from major clients, driven by strong order inflows in the second half of the year, are also expected."