Hanwha Aerospace (Hanwha Aero) is expected to rise as one of the two affiliates generating the most revenue in the group alongside Hanwha Life Insurance. The shift is driven by a string of large orders in its core institutional sector of defense and a sharp expansion in scale after bringing Hanwha Ocean in as a subsidiary.
According to FnGuide on the 20th, Hanwha Aero's consensus (outlook) for last year's revenue is tallied at 26.8948 trillion won, up 139% from a year earlier. If the actual results match the outlook, Hanwha Aero's revenue will hit an all-time high.
Hanwha Aero has set new revenue records every year since 2022, but its share of the group's total revenue had not been large. As of 2024, Hanwha Group's total revenue was 83.8056 trillion won, of which Hanwha Aero accounted for 11.2401 trillion won, or about 13%. The affiliate with the largest revenue share was Hanwha Life Insurance at 29.3%, posting 24.5845 trillion won in revenue.
The revenue outlook for last year compiled by FnGuide for Hanwha Life Insurance has not yet been released. However, given that revenue consists of insurance operating income and investment operating income, and that major subsidiaries such as Hanwha General Insurance run similar businesses, many expect it will be difficult to see a sharp year-over-year increase in revenue.
Hanwha Life Insurance's cumulative revenue for the third quarter of last year was 20.0922 trillion won, up 16.4% from a year earlier. Assuming the same pace in the fourth quarter, Hanwha Life Insurance's revenue for last year would come to 28.6172 trillion won. Combining this estimate with the consensus, Hanwha Aero becomes an affiliate generating revenue similar to Hanwha Life Insurance. Depending on Hanwha Life Insurance's fourth-quarter results last year, Hanwha Aero could also become the affiliate that recorded the most revenue within the group.
The reason Hanwha Aero's revenue surged in just one year is that it incorporated Hanwha Ocean as a subsidiary at the end of 2024, with results starting to be reflected from last year. Hanwha Ocean won orders for 13 liquefied natural gas (LNG) carriers last year and signed contracts with the U.S. Navy for the maintenance, overhaul and repair of vessels, diversifying its revenue sources. Hanwha Ocean's estimated revenue for last year is tallied at 12.9010 trillion won, up 19% from the previous year.
Steady growth in its mainstay defense field is also cited as a reason for Hanwha Aero's revenue increase. Last year, Hanwha Aero signed export contracts with several countries, including in Southeast Asia and Australia, for core products such as K9 self-propelled howitzers, the Cheonmu multiple rocket launcher and the Redback armored vehicle. Its subsidiary Hanwha Systems is also expected to post 3.5629 trillion won, up 27% on-year, backed by orders such as the multifunction radar for Cheongung-II.
Hanwha Aero has become an affiliate generating revenue on par with Hanwha Life Insurance roughly three years after Vice Chairman Kim Dong-Kwan, the eldest son of Hanwha Group Chairman Kim Seung-youn, joined. After joining the group in 2010 and working exclusively in the energy field, Kim was promoted to group vice chairman in Aug. 2022 and appointed CEO of Hanwha Aero's strategy institutional sector.
Hanwha Aero merged Hanwha Defense in 2022 and expanded by combining the defense institutional sector of Hanwha Corp. in 2023. In 2024, it carved out non-core businesses such as Hanwha Precision Machinery and brought Hanwha Ocean in as a subsidiary, focusing on defense and shipbuilding.
In business circles, there is a view that if Hanwha Aero also delivers results in aerospace, another pillar of its business, Kim's management ability will stand out even more. The aerospace field includes aircraft gas turbine engine operations and space launch vehicle development. As of the third quarter of last year, Hanwha Aero's ground defense institutional sector posted 2.1098 trillion won in revenue, while the aerospace institutional sector recorded 604.0 billion won.