KOSPI · 042660 · Shipbuilding · ₩042660

Hanwha Ocean한화오션

042660 · KOSPI · ₩042660 · 한화오션

₩52,500▼ ₩500 (0.94%)End-of-day · Oct 28, 2026 · End-of-day prices.

Trade

Sell Buy

Valuation model · Discounted cash flow (DCF)

We use a 5-year discounted cash flow: the value of the cash the business is expected to produce, in today's money.

Fair value per share

With these assumptions the model gives no positive value.

Enterprise value: −₩28T
Equity value: −₩31T
WACC: 7.2%

Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal. This is not financial advice.

Why the model and the price differ

The model gives no positive value at these assumptions. What we can see:

To match today's price of ₩52,500, the model needs an operating margin of 7.2% every year (it uses −6.1%).
Margins ranged from −39.1% to 9.1% over the last 5 years, so this is a cyclical business. The model uses the average; the price may be set by where the cycle is now. Try the margin fade option.
40% of the last 12 months' net profit came from outside operations (stakes in other companies, interest, one-offs). The model adds those stakes at book value but doesn't project that income.
In the projection, spending on equipment, software and working capital takes most or all of the after-tax operating profit, so free cash flow is thin. Companies that invest heavily often look like this until spending slows.
Today's P/E is 7.8× against a typical 32.4× over the last 10 years.

Treat the model as a starting point: change the assumptions to the story you believe, and compare with the multiples check below.

Bear / Base / Bull

Bear: —
Base: —
Bull: —

Bear: revenue growth 3 points lower every year, EBIT margin 2 points lower, WACC 1 point higher. Bull: the opposite.

Assumptions

Cycle options

Margin path

Every year uses the cycle-average margin (−6.1%).

Revenue growth

Revenue growth, year 125%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (38% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 219.5%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (38% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 314%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (38% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 48.5%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (38% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 53%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (38% a year, annual reports), fading to 3% by year 5.

Business

EBIT margin-6.1%
Operating profit as a share of revenue.
Default: through-the-cycle average of the last 12 months and the last 5 annual reports' operating margins.
Tax rate27.5%
Share of operating profit paid as corporate tax.
Default: Korea's top corporate tax rate (25%) plus 10% local income tax.
Depreciation & amortisation2.9%
The non-cash cost of wearing out equipment, added back to cash flow (% of revenue).
Default: not in the statements, so 80% of capital spending (most spending replaces equipment that wears out).
Capital spending3.6%
Money spent on factories, equipment, software and other long-term assets (% of revenue).
Default: average of the last 3 annual reports (cash flow statements; equipment and intangibles).
Working capital22%
Stock and unpaid customer bills, less unpaid supplier bills, as a % of revenue. Each year's extra revenue ties up this much more cash.
Default: working capital (current assets less cash and deposits, minus current liabilities other than borrowings) as a share of revenue, averaged over the last 3 years.

Discount rate

Terminal growth2%
How fast cash flows keep growing every year after year 5.
Default: about Korea's long-run inflation plus real growth.
Risk-free rate4.11%
Yield on Korea's 10-year government bond: the return with almost no risk.
Default: Korea Treasury Bond 10-year yield on 2026-10-28.
Beta0.73
How much the share moves when the market moves: 1 means just like the market.
Default: 105 weeks of weekly returns against KOSPI (official index); raw beta 0.6, adjusted toward 1 and kept between 0.6 and 2.0.
Equity risk premium5.5%
The extra return investors want for owning shares instead of bonds.
Default: a typical premium for Korean shares.
Cost of debt (before tax)5.61%
The interest rate the company would pay to borrow.
Default: the 10-year yield plus a 1.5% credit spread.

Starting point

Revenue (TTM to H1 2026): ₩15T
Net debt (borrowings and leases − cash and deposits): ₩4.7T
+ Stakes and investments: ₩1.2T; Associates, long-term financial assets and deposits (book value)
− Minority interests: ₩4.8B
Shares: 306,413,394
Share price: ₩52,500
Market cap: ₩16T

TTM = trailing 12 months: the last four reported quarters added together. "TTM to H1 2026" is the 12 months up to the latest quarterly or half-year report (H1 = to the end of June). Year 1 grows from there.

Past years and projection

Grey columns are reported results from the annual reports (after-tax EBIT at the model's tax rate), so you can check the growth and margin assumptions against the past. Years 1–5 are the model.

	FY2023	FY2024	FY2025	Year 1	Year 2	Year 3	Year 4	Year 5
Revenue	₩7.4T	₩11T	₩13T	₩19T	₩22T	₩26T	₩28T	₩29T
Growth	52.4%	45.5%	18.6%	25.0%	19.5%	14.0%	8.5%	3.0%
EBIT	−₩196B	₩238B	₩1.2T	−₩1.1T	−₩1.4T	−₩1.6T	−₩1.7T	−₩1.7T
EBIT margin	−2.7%	2.2%	9.1%	−6.1%	−6.1%	−6.1%	−6.1%	−6.1%
After-tax EBIT	−₩142B	₩172B	₩847B	−₩829B	−₩991B	−₩1.1T	−₩1.2T	−₩1.3T
+ Depreciation	—	—	—	₩544B	₩650B	₩741B	₩804B	₩828B
− Capital spending	₩134B	₩379B	₩717B	₩675B	₩807B	₩920B	₩998B	₩1T
− Working capital	₩1.4T	₩3.1T	−₩146B	₩825B	₩804B	₩690B	₩478B	₩183B
Free cash flow	—	—	—	−₩1.8T	−₩2T	−₩2T	−₩1.9T	−₩1.6T
Discount factor	—	—	—	0.933	0.870	0.812	0.757	0.706
Present value	—	—	—	−₩1.7T	−₩1.7T	−₩1.6T	−₩1.4T	−₩1.2T

Terminal value −₩29T, worth −₩20T today: 73% of enterprise value. It assumes spending settles at 110% of depreciation once growth slows to the terminal rate.

Cross-check: what the market has paid before

For cyclical businesses, analysts check a DCF against the multiples the stock has traded at through past cycles. Price / book is the usual anchor for them: P/E looks highest at the bottom of a cycle, when earnings are smallest, and lowest at the top. The price each band would give today:

	Low	Typical	High
Price / book (book value ₩24,553 a share)Now 2.14×	₩53,0452.16×	₩92,9063.78×	₩194,1617.91×
Price / earnings (last 12 months: ₩6,770 a share)Now 7.76×	₩102,56015.2×	₩219,44432.4×	₩336,24549.7×
P/E on run-rate earnings (Q2 2026 × 4: ₩9,041 a share)Now 5.81×	₩136,97315.2×	₩293,07532.4×	₩449,06649.7×

Low, typical and high are the 10th percentile, middle and 90th percentile of month-end multiples since 2021, each against the latest report out by then, per share at today's share count; loss years and P/E above 100 are left out. Run-rate earnings are one quarter × 4, not a forecast. Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Sensitivity

Fair value per share as two inputs change; the middle is the current case.

WACC ↓ · Terminal growth →	1.0%	1.5%	2.0%	2.5%	3.0%
6.2%	—	—	—	—	—
6.7%	—	—	—	—	—
7.2%	—	—	—	—	—
7.7%	—	—	—	—	—
8.2%	—	—	—	—	—

Now (TTM)

Market cap: ₩16T
Enterprise value: ₩21T
P/E: 7.8×
P/B: 2.1×
P/S: 1.1×
EV/EBITDA: —
Dividend yield: 0.0%

Over time (at each year end)

	2025	2024	2023	2022	2021
Price	₩113,600	₩37,350	₩25,100	₩16,835	₩20,477
Market cap	₩35T	₩11T	₩7.7T	₩5.2T	₩6.3T
P/E	27.9×	21.7×	48.1×	—	—
P/B	5.6×	2.4×	1.8×	6.9×	2.8×
P/S	2.7×	1.1×	1.0×	1.1×	1.4×
EV/EBITDA	—	—	—	—	—
Dividend yield	0.0%	—	—	—	—

Versus similar companies

Company	P/E	P/B	P/S	EV/EBITDA	Dividend yield
Hanwha Ocean	7.8×	2.1×	1.1×	—	0.0%
HD Hyundai Heavy Industries	11.9×	2.8×	1.4×	—	2.0%
Samsung Heavy Industries	25.7×	3.0×	1.3×	—	0.0%
Daehan Shipbuilding	4.7×	1.2×	1.1×	—	0.7%
Sejin Heavy Industries	6.6×	1.7×	1.1×	—	3.0%
Hyundai Hyms	14.7×	1.4×	1.4×	—	1.3%
Inhwa Precision	12.6×	0.9×	2.8×	16.0×	2.2%
Similar companies (median)	12.2×	1.5×	1.3×	16.0×	1.6%

Calculated from end-of-day prices and filed financial statements. Not a recommendation. This is not financial advice.

Also known as: Hanwha Ocean / 한화오션 / 042660 / KRX:042660

Source: KRX statistical information