K2 tank. /Courtesy of Hyundai Rotem

Hyundai Rotem and Hanwha Aerospace stocks are weak in the early session on the 9th. This appears to be influenced by reports that the visit of Polish government officials to South Korea has been postponed indefinitely due to the aftermath of the December 3rd emergency.

Hyundai Rotem shares were traded at 52,100 won in the KOSPI market at 9:21 a.m. on the same day, down 5.27% (2,900 won) from the previous day. At the same time, Hanwha Aerospace shares recorded 373,500 won, a decrease of 2.48% (9,500 won) from the previous day.

The previous day, a media outlet reported, citing voices from military and defense industry officials, that the Polish government has confirmed it postponed its visit to South Korea indefinitely since the emergency was declared. As a result, concerns were raised that Hyundai Rotem's second export contract for K2 tanks could be delayed and that Hanwha Aerospace's additional export contract for K9 self-propelled howitzers could also be affected.

Hyundai Rotem and the Defense Acquisition Program Administration signed a first contract worth 4.5 trillion won in August 2022 to export 180 K2 tanks to the Polish government. They have been negotiating a second import contract linked to local production conditions, including the improved performance model K2PL (K2 Poland). Although it was expected that a contract would be finalized by the end of last year, negotiations have been prolonged due to pricing issues.