Hanwha Aerospace Shares Plunge Following $3.6 Billion Capital Increase Decision
Desk
korocamia@naver.com | 2025-03-21 18:35:54
Hanwha Aerospace's stock price plunged 15.37% (111,000 won) to 611,000 won on the morning of March 21, following the company's decision to conduct the largest capital increase in the history of the Korean stock market. Other Hanwha Group listed companies, including Hanwha Corp., Hanwha Systems, Hanwha Engine, Hanwha Ocean, Hanwha Solutions, and Hanwha Vision, also saw their stock prices decline.
The sharp drop in stock prices is attributed to Hanwha Aerospace's decision to approve a $3.6 billion capital increase at its board meeting the previous day. Capital increases generally have a negative impact on stock prices as they dilute the value of existing shares.
While securities analysts acknowledged the necessity of Hanwha Aerospace's investment, they expressed disappointment with the chosen method of raising funds through a capital increase. Yang Hyung-mo, a researcher at DS Investment & Securities, stated, "While we understand Hanwha Group's vision to become a global top-tier player, we are concerned about uncertainties and potential risks." Choi Kwang-sik, a researcher at Daol Investment & Securities, also commented, "It seems that the company could have sufficiently raised investment funds through this year's operating profit and subsequent steady profits, so it is disappointing that they chose a capital increase."
Daol Investment & Securities and DS Investment & Securities both downgraded their investment opinions and target stock prices for Hanwha Aerospace. Samsung Securities downgraded its investment opinion but raised its target stock price from 640,000 won to 725,000 won.
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