Hanwha Ocean's stock price plummeted following news that it failed to secure an order for Canada's next-generation submarine project. Since expectations for large-scale overseas defense projects had been largely reflected in the stock price, investor sentiment is interpreted to have contracted rapidly.

However, securities firms note that this outcome does not undermine the company's earnings foundation, projecting that the key variables for the future stock price will be the U.S. market and growth in the commercial vessel segment.

Short-Term Volatility Expands... Closes Down 22.65%

Hanwha Ocean closed trading at 89,800 won, down 26,300 won (22.65%) from the previous trading day. Following a sharp correction in a short period, the market is focused on the impact of the Canadian submarine project result on investor sentiment.

The decline was triggered by the Canadian government selecting Germany's ThyssenKrupp Marine Systems (TKMS) as the preferred bidder for the Canadian Patrol Submarine Project (CPSP). The project aims to procure up to 12 diesel submarines to replace the Victoria-class submarines currently operated by the Canadian Navy, and including construction and long-term maintenance, the total project value is estimated to reach up to 60 trillion won.

The market believes that since Hanwha Ocean was mentioned as one of the leading candidates and related expectations had been priced in, disappointment selling intensified after it was excluded from the preferred bidder selection.

Securities Firms: "No Change in Earnings Forecast... U.S. and Commercial Vessels Are Key Variables"

However, securities firms assess that this failure to secure the order is not a factor that fundamentally changes the company's mid- to long-term earnings outlook. Based on its already secured order backlog and stable construction volume, the trend of earnings improvement is likely to continue.

Going forward, investor attention is expected to shift to whether the U.S. shipbuilding competitiveness policy "MASGA (Make American Shipbuilding Great Again)" will be pursued, the expansion of the U.S. naval vessel maintenance, repair, and overhaul (MRO) market, and profitability improvements in the high-value-added commercial vessel segment. There are also expectations that once these businesses begin in earnest, they could partially offset the gap in overseas defense orders.

Securities firms projected that while short-term volatility due to contracted investor sentiment cannot be ruled out, the expansion of U.S. business and earnings improvements in the commercial vessel segment will be the key factors determining the revaluation of Hanwha Ocean's corporate value.

[This article was written with the assistance of AI. This article is not an investment solicitation, and any losses resulting from asset investment may be borne by the investor.]