KOSPI · 272210 · Electronic components · ₩272210

Hanwha Systems한화시스템

272210 · KOSPI · ₩272210 · 한화시스템

₩66,200▲ ₩3,100 (4.91%)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

₩13,139

vs the current price (₩66,200)

Enterprise value: ₩3T
Equity value: ₩2.5T
WACC: 7.0%

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 is 80% away from today's price. A gap this size usually means the market expects something the past figures don't show yet, or the model leaves something out. What we can see:

To match today's price of ₩66,200, the model needs an operating margin of 15.2% every year (it uses 4.1%).
Or revenue growth +36.4 points a year higher than assumed in each of the 5 years.
Analysts' forecasts for 2026: revenue ₩3.9T, operating profit ₩290B (7.3% margin) (2 brokers). The model starts from the last 12 months reported.
Analysts' forecasts for 2027: revenue ₩4.4T, operating profit ₩456B (10.3% margin) (2 brokers). The model starts from the last 12 months reported.
31% 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.
Today's P/E is 71.2× against a typical 24.9× 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: ₩1,531; −97.7%
Base: ₩13,139; −80.2%
Bull: ₩33,881; −48.8%

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 (4.1%).

Revenue growth

Revenue growth, year 118.8%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (18.8% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 214.8%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (18.8% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 310.9%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (18.8% a year, annual reports), fading to 3% by year 5.
Revenue growth, year 46.9%
How much sales grow that year, compared with the year before.
Default: the last 3 years' revenue growth (18.8% 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 (18.8% a year, annual reports), fading to 3% by year 5.

Business

EBIT margin4.1%
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 & amortisation6.6%
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 spending8.3%
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 capital-10%
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.
Beta0.6
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 0.29, 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): ₩4.1T
Net debt (borrowings and leases − cash and deposits): ₩1.6T
+ Stakes and investments: ₩1.1T; Associates, long-term financial assets and deposits (book value)
− Minority interests: ₩79B
Shares: 188,919,389
Share price: ₩66,200
Market cap: ₩13T

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	₩2.5T	₩2.8T	₩3.7T	₩4.9T	₩5.6T	₩6.2T	₩6.7T	₩6.9T
Growth	12.1%	14.3%	30.7%	18.8%	14.8%	10.9%	6.9%	3.0%
EBIT	₩93B	₩219B	₩120B	₩201B	₩231B	₩256B	₩274B	₩282B
EBIT margin	3.8%	7.8%	3.3%	4.1%	4.1%	4.1%	4.1%	4.1%
After-tax EBIT	₩67B	₩159B	₩87B	₩146B	₩167B	₩186B	₩199B	₩204B
+ Depreciation	—	—	—	₩324B	₩372B	₩412B	₩441B	₩454B
− Capital spending	₩159B	₩273B	₩318B	₩407B	₩468B	₩519B	₩554B	₩571B
− Working capital	−₩3.6B	−₩67B	₩180B	−₩78B	−₩73B	−₩61B	−₩43B	−₩20B
Free cash flow	—	—	—	₩140B	₩144B	₩141B	₩128B	₩108B
Discount factor	—	—	—	0.934	0.873	0.816	0.762	0.712
Present value	—	—	—	₩131B	₩126B	₩115B	₩98B	₩77B

Terminal value ₩3.5T, worth ₩2.5T today: 82% 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 ₩23,781 a share)Now 2.78×	₩25,9351.09×	₩36,4311.53×	₩77,6023.26×
Price / earnings (last 12 months: ₩929 a share)Now 71.2×	₩10,71711.5×	₩23,12924.9×	₩73,20078.8×
P/E on run-rate earnings (Q2 2026 × 4: ₩1,420 a share)Now 46.6×	₩16,37711.5×	₩35,34424.9×	₩111,85778.8×

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%
6.0%	₩13,168	₩15,004	₩17,299	₩20,249	₩24,181
6.5%	₩11,657	₩13,155	₩14,988	₩17,279	₩20,224
7.0%	₩10,399	₩11,644	₩13,139	₩14,968	₩17,255
7.5%	₩9,334	₩10,385	₩11,627	₩13,119	₩14,945
8.0%	₩8,423	₩9,320	₩10,368	₩11,607	₩13,097

Now (TTM)

Market cap: ₩13T
Enterprise value: ₩14T
P/E: 71.2×
P/B: 2.8×
P/S: 3.0×
EV/EBITDA: —
Dividend yield: 0.8%

Over time (at each year end)

	2025	2024	2023	2022	2021
Price	₩54,400	₩22,600	₩17,360	₩10,550	₩16,000
Market cap	₩10T	₩4.3T	₩3.3T	₩2T	₩3T
P/E	42.4×	9.4×	9.4×	—	30.7×
P/B	2.1×	1.7×	1.5×	1.0×	1.4×
P/S	2.8×	1.5×	1.3×	0.9×	1.4×
EV/EBITDA	—	—	—	—	—
Dividend yield	0.9%	1.5%	—	—	—

Versus similar companies

Company	P/E	P/B	P/S	EV/EBITDA	Dividend yield
Hanwha Systems	71.2×	2.8×	3.0×	—	0.8%
Samsung Electro-Mechanics	96.8×	9.5×	7.8×	—	0.2%
Doosan	39.2×	5.5×	0.7×	—	0.4%
LG Innotek	13.1×	1.4×	0.4×	—	0.5%
Isupetasys	35.4×	8.3×	5.4×	—	0.0%
Daeduck Electronics	44.8×	7.0×	5.0×	—	0.4%
Simmtech	—	7.6×	2.9×	—	0.1%
Similar companies (median)	39.2×	7.3×	4.0×	—	0.3%

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

Also known as: Hanwha Systems / 한화시스템 / 272210 / KRX:272210

Source: KRX statistical information