Why is Trump's inauguration sparking stock boom for Hanwha Group?

By Lee Yeon-woo

Stock prices of Hanwha Group companies are surging ahead of Donald Trump's inauguration as the president of the United States, far outpacing competitors like Samsung and POSCO. Analysts attribute this growth to the group's robust portfolio of Trump beneficiary stocks, which have been dominating the market lately.

According to the Korea Exchange, the PLUS Hanwha Group exchange-traded fund (ETF) rose by approximately 25 percent as of Thursday, just three weeks after its listing. This financial product, an ETF composed exclusively of Hanwha Group stocks, currently ranks first in growth rate within the domestic ETF market.

Individual stocks are also on the rise. This month, Hanwha Ocean and Hanwha Engine, both in the shipbuilding sector, posted gains of 35.4 percent and 31.3 percent, respectively. Hanwha Aerospace and Hanwha Systems, tied to the space and defense industries, also surged 8.2 percent and 3.9 percent, respectively.

Market watchers note that Hanwha Group's business portfolio is in the spotlight ahead of Trump's inauguration.

The group holds a distinct edge in the shipbuilding industry, which has drawn attention from Trump. Last year, it expanded into the U.S. market by acquiring the Philly Shipyard.

"Hanwha Ocean is the leading contender for securing (U.S.) orders, as its acquisition of the Philly Shipyard exempts it from the restrictions, prohibiting the construction of warships in foreign shipyards," SK Securities analyst Han Seung-han said.

The group's strength in the defense sector has also been widely recognized. While there is speculation that global conflicts like Russia's invasion of Ukraine could be resolved soon, the medium- to long-term outlook suggests an inevitable rise in demand for weaponry.

Many countries, responding to Trump's "America First" policies, are accelerating efforts to bolster military capabilities for self-reliance. Trump himself has vowed to increase the U.S. defense budget significantly.

"In addition to Hanwha Aerospace's current export volume to Poland, which is driving performance, a diverse range of weapon systems is expected to support future growth," Hana Securities analyst Wee Kyung-jae said.

Hanwha Investment & Securities has also seen an unexpected boom, fueled by speculation surrounding Trump’s potential pro-crypto policies. Its stock price has risen 6.4 percent this month. The firm holds a 5.97 percent stake in Dunamu, the operator of Upbit, Korea's largest cryptocurrency exchange.

Conversely, conglomerates expected to be negatively affected by Trump’s policies — such as tariff hikes and subsidy cuts — are experiencing instability.

Amid concerns over semiconductor technology competitiveness and increased regulations targeting China, the KODEX Samsung Group ETF has fallen by 6.6 percent over the past three months.

The ACE POSCO Group Focus ETF has also declined by 26 percent during the same period, weighed down by fears of a temporary slowdown in electric vehicle demand and reduced subsidies under the U.S. Inflation Reduction Act.