Hanwha Ocean (042660) 🔎 In-depth
KOSPI · Price as of 2026-08-06 · Updated 2026-08-09
Hanwha Ocean is a shipbuilder that builds merchant ships such as LNG carriers, very large crude carriers (VLCCs) and container ships, and special-purpose vessels such as submarines and surface combatants, earning money by winning orders and constructing and delivering ships over several years. In the first quarter of 2026, revenue was ₩3.2099 trillion and operating profit ₩441.1 billion, up 71% from the same period a year earlier, as a rising share of high-priced LNG carriers combined with currency effects to lift profit sharply. The point to watch is that it is in a phase where older, low-priced orders are being replaced by high-priced new orders, lifting margins, so this year's profit flow is strong, but shipbuilding is an industry where order prices and profit move together with the cycle, so signs of slowing new orders bear watching.
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30-second brief
Pulled directly from the computed values below — not a separately written opinion.
What do the SourceComputedEstimateReading tags mean?
Source filings and exchange data · Computed calculated from public data · Estimate our own unverified projection · Reading drafted automatically, then rule-checked. See AI & Automation.
Core valuation metric
This stock's effective sub-sector is “Shipbuilding” (Shipbuilding, Machinery, Defense & Power Equipment), a type typically read first through P/B.
Shipbuilding rides a heavy vessel-ordering cycle, with profits bunching in upturns and slipping into losses in downturns, so current-year earnings alone give an unstable read. That makes price-to-book (P/B) — the share price against the value of docks and facilities the company owns — the first lens.
Price against assets alone says little about where the cycle stands. Reading it together with price against this year's expected earnings shows how far profits have recovered.
This note explains how each sector is typically valued and is educational context only, not investment advice.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt is somewhat higher than equity (debt ratio 204.8%).
- Revenue rose 18.6% year over year, and the pace is slowing (3-year trend: rising).
- Most recent quarter (Q1 2026) revenue was 2.1% higher than a year earlier.
- ROE is 22.4% (controlling-interest basis). It is above the sector average.
- Operating margin is 10.5%.
- A sector-metric and in-depth research verdict — see “Valuation vs peers” below for the basis.
Ownership & governance As of 2025-12-31
Largest shareholder Hanwha Aerospace 30.44% (corporate)
Controlling bloc incl. related parties 42.01%
With the controlling bloc holding 42%, the ownership structure is stable.
🔎 In-depth analysis Reading
Hanwha Ocean is a shipbuilder that makes and sells ships. The large axis of revenue is the merchant-ship division, where it builds LNG (liquefied natural gas) carriers, very large crude carriers (VLCCs) and container ships. LNG carriers in particular are high-value vessel types with a high per-ship price and high margins. The other axis is the special-vessel division, where it makes warships such as submarines and surface combatants, and it has lately expanded into maintenance (MRO) of U.S. Navy vessels. In shipbuilding, once an order is won the ship is built in stages over several years, and revenue is recognized as work progresses. So the order backlog in hand is a metric that shows several years of future work in advance.
The latest close is ₩90,700 and the market capitalization is ₩27.8 trillion. The price sits above its 20-day moving average (₩83,650) and below its 60-day moving average (₩103,752). Short-term and medium-term trends are diverging, so the direction is best read separately. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 50.5, a neutral level. The one-month change is +1.0%, the three-month change is -30.3%, and the position relative to the 52-week high is -39.5%. Relative strength versus the KOSPI is 10 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 10% of all stocks. Over the past three months it lagged the index by 16.9%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Profitability is on the good side. ROE (how much is earned in a year on equity) is 20.2%, the highest among shipbuilding peers. The operating margin is 9.1%. That said, the balance sheet is on the heavy side. The debt ratio (debt relative to equity) is 226%, with debt somewhat exceeding equity. Shipbuilding has an industry trait of advances and progress payments received in advance being booked as liabilities, but the absolute level is not light. Net debt (total borrowings minus cash) is about ₩5 trillion. EV/EBIT (enterprise value divided by operating profit) is 31.7x and EV/Sales (divided by revenue) is 2.9x. These multiples are calculated on last year's earnings, so they look high. But with this year's operating profit rising sharply, the same multiples fall on this year's earnings basis. The FCF yield (actual cash generated relative to market cap) is 1.87%, and given the shipbuilding trait of ongoing large-scale construction and investment, cash headroom is hard to call ample yet.
This is a company whose profit has turned around sharply from the bottom. Over five years, in 2021-2022 it posted operating losses of around ₩1.7 trillion a year. It then narrowed the loss to ₩196.5 billion in 2023 and turned to profit at ₩237.9 billion in 2024. In 2025 operating profit jumped to ₩1.1676 trillion. Net profit also rose to ₩1.2458 trillion in 2025, up 136% year-on-year. Revenue rose 18.6% year-on-year to ₩12.7835 trillion in 2025. The trend continues into 2026. First-quarter operating profit of ₩441.1 billion already equals 38% of last year's full-year operating profit. First-quarter net profit of ₩500 billion is 40% of last year's full-year net profit. The reason for this strength is clear: older orders taken at low prices, such as the 2022 Qatar project, are being completed and rolling off, and their place is being filled by high-priced orders taken at higher prices since 2024. Added to this are currency gains, cost reductions and early-delivery effects. The order backlog was about ₩34.5 trillion at the end of 2025, securing more than three years of work, and first-half 2026 orders rose year-on-year too, thickening the pipeline into next year. So even though the P/E on last year's earnings looks high, reflecting this year's sharp profit growth changes the valuation picture.
This company's disclosures center on orders. In May 2026 alone there was a series of single sales/supply contract disclosures. A shipbuilder issues a supply-contract disclosure each time it wins an order for a ship or a series. The accumulation of these disclosures is future revenue itself. First-quarter results were also confirmed through regulatory disclosure. The company officially reported results of ₩3.2099 trillion in revenue and ₩441.1 billion in operating profit, showing that profit grew sharply from the same period a year earlier. It also issued a scheduled IR disclosure in May. On the special-vessel side, its expansion into U.S. Navy maintenance (MRO) and warship business appeared through disclosures on related-party investments and contracts. On the confirmable recent basis, no dividend payment history is on record, which reads as a stage where profit is still being spent on growth and financial improvement rather than dividends.
The strength is the direction of profit. The company has emerged from large-scale losses and entered a phase where high-priced orders feed into results. The first-quarter profit surge shows this. Its ROE is the highest among shipbuilding peers. An order backlog laying out more than three years of work also raises earnings visibility. It also has separate growth axes in special vessels and U.S. Navy business. The cautions deserve balanced attention. With a debt ratio of 226%, the balance sheet is on the heavy side. Shipbuilding is fundamentally cyclical, so if new-ship orders slow, order prices and subsequent margins could both wobble. The P/E and P/B on last year's earnings do not look low versus peers. But this is a trait of the inflection phase where profit is rising sharply, and on this year's earnings basis the burden falls considerably. In sum, while high-priced orders convert into results and the order cycle holds, profit and profitability come through strongly. Conversely, if slowing orders combine with cost or currency headwinds, that strength can weaken.
🔎 Valuation vs peers Fairly valued
Large domestic shipbuilders (merchant and special-vessel builders), centered on the three closest shipbuilding peers by business substance.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Samsung Heavy Industries | 35.65x | 4.31x | 12.31% |
| HD Hyundai Heavy Industries | 37.60x | 5.48x | 19.61% |
| HD Korea Shipbuilding & Offshore Engineering | 13.06x | 2.09x | 19.91% |
The P/E on last year's earnings is 20.2x, actually lower than pure shipbuilding peers Samsung Heavy Industries (35.3x) and HD Hyundai Heavy Industries (34.9x). It is higher than HD Korea Shipbuilding & Offshore Engineering (10.9x), which has a holding-company character. The P/B is 4.07x, a mid-range level. That said, Hanwha Ocean is in an inflection phase where profit is rising steeply, so last year's (trailing) multiples overstate the actual picture. Given that first-quarter operating profit already reached 38% of last year's full year, the P/E on this year's earnings (forward) falls considerably below trailing. Its ROE is the highest among peers and there is more room for profitability improvement, so the premium is not at an unreasonable level. Conversely, the shipbuilding-specific order cycle and the heavy balance sheet (debt ratio 226%) are discount factors. Taking these together, rather than "overvalued" we see it as a fairly valued range that reflects the profit-improvement trajectory.
Price history Close · MA20 · MA60
The latest close is ₩90,700 and the market capitalization is ₩27.8 trillion. The price sits above its 20-day moving average (₩83,650) and below its 60-day moving average (₩103,752). Short-term and medium-term trends are diverging, so the direction is best read separately. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 50.5, a neutral level. The one-month change is +1.0%, the three-month change is -30.3%, and the position relative to the 52-week high is -39.5%. Relative strength versus the KOSPI is 10 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 10% of all stocks. Over the past three months it lagged the index by 16.9%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Relative performance stock vs index · start = 100
Excess return vs index · 3M -16.94% / 6M -46.63% / 12M -52.65%
Key metrics Computed vs sector median
Valuation
The P/E of 22.31x is above the sector median (12.80x). The P/B of 4.07x is above the sector median (1.61x). That said, this P/E is based on last year's (trailing) results. With recent quarterly earnings up sharply, the trailing P/E can look higher than it really is, so a precise read is best done on this year's expected (forward) earnings.
Enterprise value (EV)
EV = market cap + net debt. It reflects cash and debt, so it captures the real cost of the whole business that market cap alone misses; lower multiples are cheaper relative to earnings or sales.
Profitability & financials
Return on equity (ROE) is 22.4%, above the sector average (13.0%). The operating margin is 10.5%. The debt ratio is 204.8%, so the financial structure is somewhat high.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $5.2B | $7.6B | $9.0B | +18.63% ↓ slower |
| Operating profit | -$138.0M | $167.1M | $820.2M | +390.84% |
| Net profit | $112.3M | $371.0M | $875.2M | +135.90% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $3.2B | $3.4B | $5.2B | $7.6B | $9.0B |
| Operating profit | -$1.2B | -$1.1B | -$138.0M | $167.1M | $820.2M |
| Net profit | -$1.2B | -$1.2B | $112.3M | $371.0M | $875.2M |
| Revenue CAGR | 4-yr avg 29.92% | ||||
Revenue rose 18.6% year over year (2023 ₩7.4 trillion → 2024 ₩10.8 trillion → 2025 ₩12.8 trillion), and the three-year trend is 'rising'. That said, the pace of growth slowed from the prior year. Operating profit rose 390.8% year over year. Over the 5 years on record, revenue compound annual growth (CAGR) is 29.9%. The two-year revenue CAGR is 31.4%. In the most recent quarter (Q1 2026), revenue was 2.1% higher than the same period a year earlier.
Latest quarterly results Source Q1 2026 · vs year-ago
Technical indicators Computed
What stands out
- ROE of 22.4% points to solid profitability.
- Revenue grew 18.6% year over year, a sign of growth.
Points to watch
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-04-27EarningsPreliminary consolidated first-quarter 2026 results disclosed - revenue ₩3.2099 trillion, operating profit ₩441.1 billion (up about 71% year-on-year). A rising share of high-priced LNG carriers and currency effects drove the profit improvement.Short term: the profit surge is confirmed in results, lowering the forward-based valuation burden. Medium term: a signal that the conversion of high-priced orders into results is now in full swing. Source
- 2026-05-29UpdateSingle sales/supply contract disclosure - ship-construction orders. A series of supply-contract disclosures through May 2026 filling the order backlog.Medium term: additional work secured to be recognized as revenue over the coming years. The thickness of the order backlog raises earnings visibility. Source
- 2026-05-11UpdateSingle sales/supply contract disclosure - new orders in the merchant-ship division. Continuing an order flow centered on high-priced vessel types.Medium term: high-priced new orders replace older low-priced ones, supporting the margin-improvement trend. Source
- 2026-05-07IRNotice of investor-relations event - a scheduled venue to explain results and business status to investors.Short term: an occasion for the company to explain the background to results and the order and profitability trend directly. Source
- 2026-04-27FilingRelated-party investment disclosure - investment in affiliated and overseas entities. Structural realignment tied to the expansion of U.S. warship maintenance and special-vessel business.Medium term: capital allocation supporting the separate growth axis of special vessels and U.S. Navy business. Source
Figure cross-check computed ↔ external
| Metric | Computed | External | Status | Source |
|---|---|---|---|---|
| First-quarter 2026 operating profit | ₩441.1 billion | ₩441.1 billion | Confirmed | link |
| First-quarter 2026 revenue | 3₩209.9 billion | 3₩209.9 billion | Confirmed | link |
| 2025 full-year profit (widening profit) | operating profit 1₩167.6 billion · net profit 1₩245.8 billion | — | Confirmed | link |
| 2026 full-year net profit (own estimate) | approx. ₩1.9 trillion(self-estimate) | — | Unverified | — |
Recent filings Source
- 2026-05-29Corporate governance report
- 2026-05-29Large-business-group status disclosure
- 2026-05-29Single supply/sales contract
- 2026-05-28Single supply/sales contract (amended)
- 2026-05-18Single supply/sales contract (amended)
- 2026-05-14Disclosure
- 2026-05-13PeriodicQuarterly report
- 2026-05-11Single supply/sales contract
- 2026-05-07Disclosure
- 2026-05-04Single supply/sales contract
- 2026-04-27Disclosure
- 2026-04-27EarningsFair-disclosure notice
📖 Plain-language glossary — expand if you are new to this
- P/E
- How many times a year's net profit the price is worth (lower is cheaper relative to earnings). The P/E here is on trailing (last full-year) results; for companies whose earnings swing fast (memory chips and other cyclicals/high-growth), a forward P/E on this year's expected earnings is more accurate.
- P/B
- Price relative to net assets (equity). Around 1x means it trades near book value; below 1x means below book.
- P/S
- Price relative to a year's revenue — useful for growth companies with thin earnings.
- Net debt / EV
- Net debt = interest-bearing debt − cash. Negative means more cash than debt (net cash). EV (enterprise value) = market cap + net debt, closer to what it would cost to buy the whole business.
- EV/EBIT · EV/EBITDA · EV/Sales
- Enterprise value against operating profit (EBIT), EBITDA, or revenue. Unlike P/E these reflect debt and cash; lower is cheaper relative to earnings power or sales.
- FCF / FCF yield
- Free cash flow = operating cash − capex, the cash actually left over. FCF yield = FCF ÷ market cap; higher means more cash generated per unit of market value.
- Intrinsic value (DCF)
- Future free cash flow (or, for some capex-heavy but profitable names, forecast earnings) discounted to today to estimate per-share value. Because it shifts a lot with the discount-rate and growth assumptions, it is shown as a bear/base/bull range, and the basis and assumptions are disclosed in one line beneath it.
- ROE
- How much profit the company earns in a year on its equity (%). Higher means better returns on capital.
- EPS / BPS
- Earnings per share / net assets (book value) per share.
- Operating / net margin
- Profit left from the core business / final profit after tax and interest, per unit of revenue.
- Debt ratio
- Debt relative to equity (%). Higher means more reliance on borrowing (norms vary by sector).
- Current ratio
- Assets convertible to cash within a year against debt due within a year. Above 100% leaves some short-term headroom.
- Interest coverage
- How many times operating profit covers the interest owed. Below 1x means operating profit alone struggles to cover interest.
- Dividend yield / payout ratio
- The year's dividend as a % of today's price / the share of earnings paid out as dividends.
- Revenue CAGR
- Multi-year growth expressed as a single yearly average (compound annual growth rate).
- RSI (short-term signal)
- Whether recent price action is overheated or beaten down. Above 70 is overbought, below 30 oversold.
- MA20 / MA60 (moving averages)
- The 20- and 60-day average price. Price above them signals a firmer short-term trend.
- vs 52-week high
- How far below the past year's peak the price sits now (%).
All figures are for reference only; how they read varies by sector and over time.
Sources: Korea FSC market-price API (data.go.kr), OpenDART, KRX/KIND — public data only.
Bong Stocks presents public-data-based information for reference only. It is not investment advice and contains no target prices, ratings, or buy/sell recommendations. Verify independently before making any decision.