In today’s briefing:
- FSS Surprisingly Halts Hanwha Aerospace’s Rights Offering Capital Raise Temporarily
- The Hidden Play in Hanwha’s Noisy Stake Reshuffling: Hanwha Corp’s Rights Issue
- D’Alba Global IPO Valuation Analysis
- Samsung India Electronics: The Biggest Consumer Company in India. Financials & Valuation
FSS Surprisingly Halts Hanwha Aerospace’s Rights Offering Capital Raise Temporarily
- After the market close on 27 March, the Financial Supervisory Service (FSS) surprisingly announced a temporary halt to the 3.6 trillion won rights offering capital raise of Hanwha Aerospace.
- The FSS has requested a correction report to the massive paid-in capital increase securities report submitted by Hanwha Aerospace on 20 March.
- While there could be a short term pop to Hanwha Aerospace’s stock tomorrow, we continue remain negative on Hanwha Aerospace over next 1 year mainly due to its stretched valuations
The Hidden Play in Hanwha’s Noisy Stake Reshuffling: Hanwha Corp’s Rights Issue
- Hanwha Corp’s chances of raising 1T KRW without a capital call are slim, likely channeling Hanwha Energy’s 1.3T KRW into Hanwha Corp intead of Hanwha Aero.
- A shareholder-allotted rights issue from Hanwha Corp looks likely, and with short-selling resumption, it sets up a clean arbitrage play with low risk before the official announcement.
- Timing is key—Hanwha’s using debt for now, but likely won’t delay long. Expect Hanwha Corp’s rights issue to follow Hanwha Aero’s, probably between June and July.
D’Alba Global IPO Valuation Analysis
- Our base case valuation is based on a P/E of 21.9x (40% premium to the comps) our estimated net profit of 58.9 billion won in 2025.
- We believe d’Alba Global should trade at a premium valuation to the comps due to higher sales and operating profit growth, higher ROE and operating margins than the comps.
- Our base case valuation of d’Alba Global target price of 101,609 won per share, which represents 53% higher than the high end of the IPO valuation range.
Samsung India Electronics: The Biggest Consumer Company in India. Financials & Valuation
- Samsung India Electronics, a 100% subsidiary of Samsung Electronics (005930 KS), reported a 2024 turnover of USD 12 bn, ranking it among India’s largest consumer sector companies.
- It is a leading player in smartphones, smart TVs, and home appliances, with FY2024 revenues 4.5X that of LG Electronics India (123D IN).
- Estimated valuations of Samsung India Electronics could represent nearly 20% to 25% of its parent’s EV, when valued using India peer group multiples.
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