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Hanwha Solutions (Photo Credit: Hanwha Solutions) |
[Alpha Biz= Reporter Kim Minyoung] On the 6th, Kiwoom Securities announced that it has adjusted its earnings estimates for Hanwha Solutions, considering the increased financial burden due to rising debt this year and next. Consequently, the target price was lowered by 29% from 31,000 KRW to 22,000 KRW, while maintaining a 'Marketperform' rating.
Kiwoom Securities explained, "Hanwha Solutions reported an operating loss of 107.8 billion KRW for the second quarter, a reversal from a profit in the same period last year, and below the market consensus of a 61.2 billion KRW operating loss. The significant impact came from a 91.8 billion KRW operating loss in the renewable energy segment (with an OPM of -9.4%)."
They added, "Although the scale of losses in the chemical segment and equity method gains decreased, the company still reported a net loss of 329.8 billion KRW due to a financial loss of 131.7 billion KRW, stemming from the debt burden. In contrast, First Solar, Hanwha's primary competitor in the U.S. market, announced a record operating margin (OPM) of 37%."
Kiwoom Securities noted, "While both companies saw an increase in quarterly shipments, the key driver for First Solar was the rise in average selling prices (ASP). Hanwha Solutions, on the other hand, saw little change in inventory levels since June, and although market inventories remain high, price declines appear to have stabilized."
Kiwoom Securities concluded, "Hanwha Solutions plans to issue approximately 800 billion KRW in perpetual bonds, which will increase hybrid capital. With an estimated capital expenditure (CAPEX) of around 3.2 trillion KRW in 2024, which exceeds the projected EBITDA of 2 trillion KRW, there are concerns about rising debt and financial costs for 2024-2025."
AlphaBIZ Kim Minyoung(kimmy@alphabiz.co.kr)
